From a proud stamp of ‘Made in India’, Modi’s vision of a ‘Make In India’ dream project has now completed eight years with annual FDI doubling to $83 billion while transforming the country into a leading global manufacturing and investment destination. This flagship program of the government has helped to increase foreign and domestic investment, foster innovation, enhance skill development, and build best-in-class manufacturing infrastructure.

A reduction in compliance burden has brought down costs and enhanced the ease of doing business. At the same time Production Linked Incentive Scheme (PLI) has given a big boost to local manufacturing with all 14 schemes being operational.

Gujarat the big budget state for PLI’s

The Centre now plans to focus on key sectors like semi-conductors to achieve Modi’s vision of an ‘Atmanirbhar Bharat’. Along with this, the government’s key focus will be on some specific sectors such as solar modules, mobile handsets etc. Other sectors to benefit are textiles, which is one of the biggest employer in the country, along with some earlier-proven areas where India has done well such as automobile components.

However, analysts feel the PLI programs are not well-though out and most of them seem to be biased towards Modi’s home state of Gujarat, while other states like Maharashtra is being side-lined. The prestigious Tata-Airbus deal which most industry insiders had thought would be located in Maharashtra, has recently gone to Gujarat which has led to a political spat within the states.

Right after this, Maharashtra lost yet another big PLI project by mega-giants Foxconn and Vedanta to next-door neighbour Gujarat. For this ambitious project, the budget of $10 billion for semiconductor subsidies would have been helpful for the huge state but that was not to be. Although Modi talks about ‘cooperative competitive federalism” where every state would freely compete for investors and raise each other’s standards but New Delhi seems to be in control as to what happens where in the PLI scheme of things.

Gains for the textile sector

India’s textile and apparel sectors happen to be one of the biggest employment generator in the country. India is one of the few textile producing countries in the world which can claim the complete value chain productivity strength. The sector also has several advantages like, abundance of availability of raw materials like cotton and silk, and the comparative advantage in terms of skilled manpower. Make in India can lead to penetration of organized retail, favorable demographics and rising income levels. As per a research paper by Sujit Shrikrushnarao Gulhane and Ranjit Turukmane “Effect of Make in India on Textile Sector”, the project is already proven to be a boon on the textiles sector with several MNCs already investing in the country like textile machinery makers like Rieter and Trutzschler already investing in the country. In fact, growth of the textile sector is expected to get a huge boost with the project. PM Modi’s vision of a Make in India and ‘Atmanirbhar Bharat’ will help in doing that in the long run if the focus is right.

Nike has launched a web3 project called Swoosh. This is a platform for Nike’s customers to learn about web3, collect virtual products like sneakers or jerseys and, eventually, help to co-create them — even potentially earning royalties on their sales.

In December 2022, Nike plans to begin educating members about web3, helping them set up digital wallets and encouraging them to get involved through prompts like community challenges on Instagram. In January, Nike will drop its first collection on .Swoosh and begin testing out different utilities for its virtual items, which it wants to be more than just collectables.

Like other brands testing the waters of web3, it’s exploring them as a means to sell physical products. Visitors with an access code given out to select Nike community members will be able to register on the site and claim a username. Nike’s Swoosh is aimed at the web3 curious rather than those deeply enmeshed in the space. The complicated user experience involved in setting up a digital wallet and minting NFTs — meaning logging the digital assets on a blockchain — is a barrier to entry in itself.

Nike was ahead of the curve among fashion and footwear brands making moves into crypto, securing a patent for blockchain-linked sneakers called CryptoKicks back in 2019.

Candiani and Gowan have developed a strain of cotton called Blue Seed.

Candiani is an Italian denim mill. Gowan, based in the US, is an agricultural advising company. Blue Seed cotton is an exclusive hybrid, non-GMO cotton variety, designed to be a stronger fiber but also more resistant in the field, requiring less water and chemicals than traditional cotton. The crops have been planted–and thrived–in Spain, Greece and the US so far.

Candiani started collaborating with Gowan after acquiring the genetics of the magical hybrid GMO-free seed. Candiani was targeting a superior quality type of cotton which had to be GMO free so it could be cultivated in the EU and could go organic too. This particular variety already existed, but it was languishing in obscurity and so together with its farming partners Candiani rescued it and renamed it Blue Seed. The seed is actually blue.

Blue Seed was birthed through cross-pollination of GMO-free upland and extra long staple, resulting in the best advantages from both parent plants. The current Blue Seed has also much higher strength and tenacity. Candiani and Gowan are currently looking into the development of other varieties. Candiani found excellent results in an experiment when it grew Blue Seed cotton at an institute in California with its Coreva natural stretch fiber as a regenerative fertilizer.

For the second quarter Grasim’s standalone net profit fell by 1.5 per cent. Revenue from operations rose nearly 37 per cent. Earnings before interest, taxes, depreciation and amortization (ebitda) for the quarter increased 19.4 per cent but margins contracted 206 basis points to 14 per cent. The fall in margins was due to a sharp rise in input costs and other expenses.

Revenue from the viscose staple fiber business increased 30 per cent while the chemicals business reported a 66 per cent growth in sales. Caustic soda sales volume rose 17 per cent. Captive consumption of chlorine increased during the quarter witnessing double-digit growth on a year on year basis. The business is working on plans to add new chlorine value-added products in the portfolio to increase the chlorine integration levels.

Viscose staple fiber sales volume for the quarter rose ten per cent year on year even though they were 14 per cent down on a quarter on quarter basis due to demand conditions coupled with cheaper imports from Indonesia and China.

The India-centric demand for viscose staple fiber remained largely intact but value chain partners for the global markets have started witnessing the impact of recessionary conditions. China’s average viscose staple fiber operating rates reduced to 66 per cent in the second quarter.

An Australian company BlockTexx has opened the world’s first commercial poly-cotton recycling facility. This facility will recycle around 50,000 tons of textiles and create 140 jobs over the next four years, if all goes to plan.

This is the world’s first commercial scale textile resource recovery facility focused on blended (cotton-polyester) products. The patented technology of BlockTexx, soft (separation of fiber technology), processes pure polyester, poly/cotton blends, pure cotton and any other cellulosic material.

Through the soft process, the company has achieved a very high processing recovery rate of almost one to one from feedstock input, around a 95 percent recovery rate. The recycling process of BlockTexx sees material being placed into a bespoke reactor, where polyester and cotton are separated. Cotton is broken down to cellulose, and this can be used for paints, cosmetics, concrete and other sectors. Polyester goes through a heating and liquifying process to be turned into pellets that can be used for playground equipment, furniture, coat-hangers and other products.

In terms of feedstock, BlockTexx receives materials to recycle from large scale laundries and workwear companies and as the facility’s capacity scales will integrate more post-consumer clothing into its feedstock intake. The fiber blend is critical to the process. Polyester/cotton blends, 100 percent polyester and cellulosics are the preferred fibers and brands using these materials will be the company’s priority.

An effective collaboration between global apparel manufacturers and buyers is needed for a successful transformation of the industry towards sustainability.

Dirk Vantyghem, director general of EURATEX, the European Apparel and Textile Confederation, speaking at the 37th World Fashion Convention 2022, Dhaka , said that the new strategy of the EU had set out the vision and concrete actions to ensure that by 2030 textile products placed on the EU market would be long-lived and recyclable, made as much as possible of recycled fibres, free of hazardous substances and produced in respect of social rights and the environment.

So the major challenges of the industry today can only be realistically met when there is true collaboration between buyers and manufacturers. The supply chain situation has become harder than it was during the Covid period.

To deal with the sustainability issue, a crucial strategy is improving efficiency through technological innovation. Without adopting sustainable technology, apparel exports to the European Union would be affected after 2030 due to the EU Green Deal.

This can address the major challenges the global clothing industry is facing and bring about a successful transformation in its supply chain. Apparel makers are feeling the squeeze from higher costs and lower demands while new rounds of order cancellation, full warehouses and big discounts show the ineffectiveness of the global textile and clothing industry.

Bangladesh’s woven shirt exports over the last couple of years are no longer what they used to be.

Bangladesh started its journey as a garment exporting nation in 1978 with the shipment of a few thousand formal shirts to a French buyer. In the apparel export basket, the shirts continued to maintain dominance for many years.

However, a sudden rise of other knit items outshined shirts because of easy access to associated raw materials.For instance, local spinners can currently supply 90 per cent of the raw materials required by the knitwear sector as state-of-the-art spinning mills are capable of ensuring fast delivery of the raw materials.

On the other hand, local weavers can only supply 40 per cent of the raw materials required by woven shirt manufacturers as investments expected in woven fabrics is yet to come about.As a result, woven shirt makers have to import fabrics from other countries, mainly China, which takes a lot of time and the long lead time is a major cause for concern for the garment business.

Moreover, over the last decade a massive change has taken place in global fashion because of shifts in consumer behaviour and climate change. Previously, officegoers used to wear formal woven shirts but now a majority prefer casual dresses.As a result, globally the consumption of woven shirts has fallen significantly.

From January 2022 to August 2022 Bangladesh’s denim exports to the United States rose by 46 per cent compared to the same period of 2021.In 2021, Bangladesh became the top denim exporter to the US for the second consecutive year and currently holds a 22 per cent share in the US denim market.

Bangladesh’s garment exports to the United States of America increased by 34 per cent in September 2022.

One reason for this is shifting of orders from China to other manufacturing countries and another is increasing demand for knitwear products. Buyers from the US are shifting their orders from China in large volumes to Bangladesh apart from countries like India and Vietnam.

Bangladesh’s denim is the biggest brand in the US market and US buyers consider it an elite product of high quality.Bangladesh is maintaining its growth in exporting denim apparel to the US as the top supplier, despite the slowdown in the US due to falling consumer demand caused by global economic challenges.

Bangladesh is doing well due to efficiency, strong backward linkage, quality products and many more reasons. However, overall Bangladesh’s garment exports are falling. Among the reasons are the war-related crisis, the global economic turmoil, and a record inflation affecting retail businesses.

Businesses are making bold promises on climate change, but progress has been limited. So says Remake World which has assessed dozens of the world’s leading fashion brands on progress in sustainability issues.

Only three companies meet all four of Remake’s climate criteria. These are disclosure of full emissions, short-term 1.5℃ pathway-aligned Science Based Targets, ambitious long-term net-zero targets and a reduction in their total greenhouse gas emissions.

A third of the assessed companies are reducing their packaging waste and 20 per cent now offer upcycling or repair services. Despite a rise in resale platforms and some repair initiatives there has not been a transition away from linear production. Companies are co-opting customer interest in circularity to greenwash.

While no company can show an overall reduction in production, some companies have reduced their use of virgin plastics like polyester. There is a continued lack of progress on living wages in supply chains, although some retailers are at least attempting to tackle this issue. Four companies have published some progress towards a living wage in their supply chains in addition to disclosing the methodology they use to quantify a living wage. Five companies have published partial information indicating that some of their direct employees, such as corporate employees or retail workers, earn a living wage.

Gujarat’s industrial clusters are losing order volumes and revenues to falling demand. As orders dwindle, operating margins are shrinking.A trifecta of headwinds — high domestic cotton prices, dwindling exports and grossly underutilized capacities — has eroded the profitability of cotton yarn makers. Yarn makers’ operating margins declined to 12 per cent or 14 per cent in the last fiscal compared to their decadal high of 20 per cent.

Spinning units face losses

Spinning units in Gujarat have 50 lakh spindles of installed capacity. But capacity utilization has dropped to about 50 per cent at most spinning units. Spinners are unable to command better prices as industrial demand from Europe and Bangladesh has been hit due to the war situation and energy crisis. Moreover, with the price of foreign cotton lower than that of Indian cotton, yarn makers are operating at a net loss.

Falling demand from Europe

Textile giants in Gujarat have been losing export revenue since the second quarter as demand from Europe has shrunk and inventories remain piled up. Several textile processors are yet to resume factory operations after the Diwali break. The export business isn’t doing as well, especially the European and North American markets. This has hurt capacity utilization in the textile industry.

Cotton prices

Exporters have been badly affected overall because of high cotton prices. Global cotton prices fell by 17 per cent between April and August this year in anticipation of higher output, while domestic prices rose by two per cent because of limited supply. Expensive domestic cotton has eroded India’s competitiveness, leading to a loss of export market share to China and Bangladesh.

Demand for dyes declines

When dyes and intermediates manufacturers in Gujarat had barely begun inching out of the effect of Covid, the Russia Ukraine war has hurt their growth. With exports of dyes and intermediates down by 50 per cent, manufacturers have seen a major fall in revenue. High inflation, rising energy costs and high interest rates have derailed industrial production in many parts of Europe. With consumer spending and textile demand down, the demand for dyes has declined.