GoodWeave International and Fair Wear Foundation have united efforts to address child and forced labor within hidden corners of the apparel and textile supply chains. As the European Union develops mandatory human rights due diligence legislation, their combined expertise becomes a crucial asset for businesses aiming to uphold human rights and responsible practices.

Targeting the Hidden Exploitation

Urging Fair Wear member companies sourcing from India, the collaboration encourages them to become GoodWeave licensees. This facilitates comprehensive supply chain mapping and inspections, tackling labor exploitation beyond primary factories and encompassing sub-contracted and home-based setups where the majority of abuse occurs. Remediation and prevention initiatives are integral to the partnership.

Shared Expertise, Collective Progress

GoodWeave acts as Fair Wear's knowledge partner, aiding member companies in identifying, remediating, and preventing child, forced, and bonded labor. The alignment of both organizations' work on collaborative buyer-exporter partnerships strengthens the partnership.

Focused Vision for Ethical Practices

Silvia Mera, Senior Director of Strategic Partnerships and Advocacy at GoodWeave International, underscores the alignment of their work, emphasizing the commitment to bolstering human rights due diligence in the textile industry.

About GoodWeave International

Established in 1994 by Nobel Peace Prize laureate KailashSatyarthi, GoodWeave International leads the battle against child labor in global supply chains. Their collaborative approach partners with companies and local communities to ensure supply chain transparency, uphold workers' rights, and guarantee products' freedom from labor exploitation. The GoodWeave® certification label marks child labor-free rug and home textile products.

The August 2023 ‘Apparel Trade Scenario in Key Global Markets and India’ report by Wazir Advisors, spanning June and July 2023 shows no significant change in trade scenario. Comparing the report issued at the end of July 2023 to the soon-to-be-published one, there are no newsworthy changes but more affirmation that RMG imports are currently low in Western markets and in stagnation in Japan this month, having experienced a rise last month. Indian exports continue to lose ground, making exporters around the country nervous about 2024. 

Indian exporters continue losing orders

In July 2023, India’s RMG exports were estimated at $1.1 billion, 21 per cent lower than in July 2022 exports. On a year-to-date basis that reads 15 per cent lower than exports achieved in 2022. However, in some relief, from January to July, India’s RMG exports have not lost further ground after losing 6 per cent in 2022 compared to 2021. On the other side, India had gained 5 per cent extra share in 2022 in the US market compared to 2021 but lost 2 per cent this year between January and June 2023. 

A new angle is developing in India’s RMG export basket – India is steadily growing a diversified market as its ‘other’ markets are steadily growing, with the ‘others’ standing at 42 per cent between January and June 2023 compared to 37 per cent in 2021. 

Japan’s RMG import stagnate in June

The latest Wazir report also indicates import stagnation instead of growth setting in Japan. The country imported RMG worth $1.6 billion in June this year, which is exactly the same amount it imported in last June, indicating no change year-to-date. Between January and June this year, China lost 4 per cent of Japanese market share, with Bangladesh gaining 1 per cent and other sourcing destinations gaining 3 per cent. Vietnam and Cambodia experienced no growth in their respective market shares. 

EU arrests its downward slide by 12 per cent in June

The EU’s apparel imports in May 2023 decreased 22 per cent compared to May 2022 but come June, the decrease gap was 12 per cent less at 10 per cent, compared to June 2022. The value of RMG imports within the EU in June 2023 was $7 billion and on a year-to-date basis overall RMG imports are down by 4 per cent. 

UK sees positive growth all around in June

In June 2023, the UK imported RMG worth $1.9 billion, which was 5 per cent higher than in June 2022. Moreover, in July 2023, UK’s monthly apparel store sales were £3.7 billion, 3 per cent higher than July 2022 and its Q2 2023 online sale of RMG registered a 10 per cent increase compared to Q2 of 2022. 

US retail growth remains positive as imports drop

In July 2023, US monthly apparel store sales were estimated at $18.2 billion, 5 per cent more than in July 2022. On year-to-date, RMG sales in 2023 are 5 per cent higher than in 2022. In Q2 2023, online sales of RMG and accessories registered negligible 1 per cent growth over Q2 2022. In home furnishing category though it is negative growth – store sales were down in July 2023 by 10 per cent compared to July 2022. This July, total sales value was at $ 4.7 billion. 

However, the story is different in RMG import front – the US imported $6.6 billion worth RMG in June 2023, 23 per cent lower than June 2022. On a year-to-date basis, the figure is 22 per cent lower than in 2022. Thanks to the Xinjiang issue, China lost a 5 per cent market share since 2021. 

Textile giants in Pakistan to supply fabrics to Philippine garment exporters

The largest textile and garment factories in Pakistan have committed to supplying textiles and fabrics to Philippine garment exporters.This is a major development as the Philippines does not have a significant textile industry.The Pakistani factories will supply mostly 100% cotton sheets and denim.The Pakistani factories are able to offer lower prices than other countries due to their lower production costs.

Philippines has unparalleled access to key markets

The Philippines has unparalleled access to key markets, including ASEAN, APEC, Asia, Europe, and the United States.This makes it an attractive destination for Pakistani exporters.The Philippines is also a member of the World Trade Organization and the European Union's Generalized Scheme of Preferences Plus program, which gives it access to preferential trade terms.

Pakistan has invested in Philippines

Pakistan has already invested in the Philippines in various sectors, including garments, textiles, and pharmaceuticals.This investment is likely to increase in the future as the two countries strengthen their trade ties.

Sri Lanka has expressed its intention to join the Regional Comprehensive Economic Partnership (RCEP), the world's largest free trade agreement. The announcement was made by President Ranil Wickremesinghe on August 8, 2023, during a speech marking the 56th anniversary of the Association of Southeast Asian Nations (ASEAN).

RCEP is a trade bloc that includes 15 countries in Asia-Pacific, including China, Japan, South Korea, Australia, and New Zealand. It covers a market of over 2.3 billion people and a GDP of $28.3 trillion.

Sri Lanka's membership in RCEP would be a major boost to its economy. The agreement would lower tariffs on goods and services, making it easier for Sri Lankan businesses to export their products to other RCEP countries. It would also open up new investment opportunities for Sri Lankan businesses.

In addition, Sri Lanka's membership in RCEP would help to demilitarize the Indian Ocean. The agreement includes a commitment to cooperate on maritime security, which could help to reduce tensions in the region.

Kenya will host the ITME Africa & Middle East 2023 textile industry event from November 30th to December 2nd, 2023. The event will bring together representatives from 18 countries to foster new business alliances, explore prospects, and connect with the local textile sector.

Organized by the India ITME Society, the event aims to establish a platform for participating companies to engage with importers, buyers, agents, and dealers, not just within Kenya, but across multiple African countries seeking to invigorate or fortify their textile industries.

Notable participants in ITME Africa & Middle East 2023 will include machinery manufacturers and textile technologists from India, Turkey, Taiwan, Italy, Benin, Ghana, Kenya, Austria, Zambia, Sri Lanka, Germany, Rwanda, Spain, China, and more. Indian companies view this event as an exciting avenue to expand their customer base within the emerging markets of Africa and the Middle East.

Prominent brands and manufacturers such as Lakshmi Machine Works Ltd (LMW), A.T.E. Huber Envirotech, Luwa India, Kusters Calico, Gurjar Gravers, Hindtex Industries, and others have already confirmed their presence, along with country pavilions from China, Italy, Ghana, Turkey, and Taiwan, showcasing their technological and engineering prowess.

ITME Africa & Middle East 2023 transcends being a mere event or exhibition. It aims to offer holistic solutions for the textile industry, affordable technology, global exposure, learning experiences, and a convergence of business entities. It opens doors for investments, joint ventures, access to finance, networking with experts, educators, and thus ushers in a wave of knowledge, progress, growth, and prosperity.

The India ITME Society Team has proactively garnered support for this event from the Indian Embassy, governmental organizations, and associations in Kenya, ensuring its success through active visitor engagement. The Kenyan Government and Industry Bodies wholeheartedly back this technology and trade business event.

The opportunity for industry delegation groups to attend and network with trade associations, government officials, and industry members is also available.

The India ITME Society has invested significant effort to create this opportunity for the textile industry, textile engineering, and allied fields to discover new horizons in Africa and the Middle East.

A staggering $468 billion worth of garment imports in the G20 are exposed to the risk of modern slavery, according to the 2023 Fashion Transparency Index. This is equivalent to one-third of these countries' goods imports.

The fashion industry has a poor track record of monitoring such abuses within its supply chains. Only 23% of brands disclose information about the prevalence of modern slavery-related violations and risk factors in their supply chains.

Governments are now taking steps to induce change through new legal restrictions. The Uyghur Forced Labor Prevention Act (UFLPA) took effect in the U.S. in June 2022, prohibiting goods from the Xinjiang Uyghur Autonomous Region (XUAR), responsible for a fifth of the world's cotton production. Brands are required to provide evidence that their products are free from any involvement with forced labor.

The European Union is following suit with proposed regulations to ban forced labor and a Corporate Sustainability Due Diligence Directive. Individual countries are also enacting new laws, including the German Supply Chain Due Diligence Act and the Norway Transparency Act in 2021.

These new laws are putting pressure on brands to improve their due diligence practices and ensure that their supply chains are free from modern slavery. However, the task is daunting, given the complexity of fashion supply chains and the large production volumes of many brands.

New technologies, such as DNA identification of cotton yarn origins, can help brands to improve their due diligence. However, more needs to be done to ensure that these technologies are used effectively.

Consumers can also play a role in driving change. By demanding more transparency from brands and choosing to buy products from companies that are committed to ethical sourcing, we can help to make the fashion industry more sustainable and ethical.

The commerce and industry ministry is finalizing the national e-commerce policy. The policy will be presented to the highest levels of government for final approval. It will consider the interests of all stakeholders, including investors, manufacturers, MSMEs, traders, retailers, startups, and consumers. The policy will aim to create a conducive environment for the holistic and harmonious growth of the e-commerce sector. It will also address data localization and other regulatory concerns.

Background

The ministry had previously released two drafts of the national e-commerce policy in 2018 and 2019. The 2019 draft covered six key aspects of the e-commerce ecosystem: data, infrastructure development, e-commerce marketplaces, regulatory concerns, stimulation of the domestic digital economy, and promotion of exports through e-commerce. 

The draft included discussions on measures such as cross-border data flow restrictions, handling sensitive data locally before storing it abroad, measures to combat the sale of counterfeit goods, restricted items, and pirated content.

Current status

The ministry has held extensive discussions with representatives from e-commerce companies and a domestic traders' association on the proposed policy. A significant level of consensus has been reached among the concerned parties. The focus is now on obtaining final approval for the policy.

Next steps

The policy will be presented to the highest levels of government for final approval. Once it is approved, the policy will be implemented.

Epilogue

The national e-commerce policy is a significant step towards regulating the e-commerce sector in India. The policy is expected to create a conducive environment for the growth of the sector and protect the interests of all stakeholders.

Here are some of the key points of the policy:

• The policy will consider the interests of all stakeholders, including investors, manufacturers, MSMEs, traders, retailers, startups, and consumers.

• The policy will aim to create a conducive environment for the holistic and harmonious growth of the e-commerce sector.

• The policy will address data localization and other regulatory concerns.

• The policy will be presented to the highest levels of government for final approval.

• The policy will be implemented once it is approved by the government.

The heightened customer awareness about wearing sustainable and environment-friendly apparels is helping drive up demand for clothing repair and re-wear by premium brands around the globe. With an underlying concept of a stitch in time saves nine, many leading garment companies are creating a scalable and profitable after-sale repair service business to make them last a lifetime, while overcoming tricky logistical and workforce challenges in doing so.

A recent study by the Massachusetts Institute of Technology (MIT) has shown that for a global population of 8 billion, around 19 pieces of clothing per person are manufactured yearly and the emissions generated throughout the lifecycle of clothing are just massive and unaccounted for.

It’s not just about nostalgia and re-wearing favorite clothes, but a newer way of enjoying fashion over a longer period versus fast-fashion where clothes are bought and thrown away post use. From receiving alteration orders from textile trading firms that wholesales products to apparel makers, fixing clothing damaged during the production process to make it sellable as well as after-sales paid service of reworking embroidery, buttons and embellishments with bespoke tailoring, the repairing and recycling apparel segment is a versatile one.

Japan leads the way

Japan has always led the way in the repairing garment segment with many local brands having in-house services to remake and repair their traditional kimonos. They are now going global in expanding their mending services with global brands. Some repair and tailoring companies such as Japan Apparel Quality Center founded the Shibaura Repair Workshop to provide such services for its corporate customers around the world. The services include alteration to accepting orders from individual customers.

“The negative environmental impacts of the fashion industry became widely known, prompting eco-friendly ethical consumption behaviors to rapidly become widespread among them. There is a new view among consumers, too, that it’s cool to upcycle favorite clothes and wear them longer,” says Noriko Saiki, Senior Manager, Japan Research Institute and an expert on the relationship between fashion and the United Nation’s Sustainable Development Goals.

Globally, premium brands such as Patagonia, Nudie Jeans, Zara, Levi’s, and Uniqlo among others are stepping in with repair services that are focused on sustainability and waste reduction. Fast-fashion brand Uniqlo now has repairing services at three Uniqlo shops in Japan, which specialize in repairing and remaking products such as fixing tears, adding embroidery to old clothing, alteration services, and accepting orders to fix puffer jackets and damaged crotch area of jeans, among other repair types.

Brands launch innovative apparel re-use schemes

Not just Japan. similar global efforts are in place in Europe with the French government recently announcing it will subsidize clothing and shoe repairs to reduce waste starting in October 2023. Spain’s Inditex, which operates Zara stores globally, has plans to launch repairs in major markets and has already launched a mending service for its products in Britain in November 2022. H&M has collaborated with a startup to help fix damaged apparel with a scheme called ‘Close the Loop’ which encourages customers to deposit their used clothing in in-store recycling bins and receive a coupon for their next purchase. On same lines, cosmetics giant Sephora has introduced a program called ‘Beauty (Re) Purposed’, which focuses on hard-to-recycle packaging waste in the beauty industry, which has managed to reach its target consumers and bring in profits. 

However, most big retailers are facing a labor shortage as they try to keep up with the rising repairing and rewear garment demand as it’s a difficult segment that takes concentrated effort and high skill set and many young staffers are not interested. Also, the popularity of cheap fast fashion has ensured the average middle-class shopper will not have the money or interest to invest in repairing old clothes. The repair-and-wear apparel segment does build brand loyalty and longevity but it’s a niche one that is just at the starting line still waiting to get up and go fast.

The fashion sector is always haunted at the prospect of yet another allegation from social activists or laws passed against its dubious sourcing practices, leaving the sector defensive and running for cover. These are not without reason as for decades the fashion sector has exploited underdeveloped countries’ cheap labour forces for financial gains, at the expense of mostly women and children. The garment industry, a significant source of employment, provides jobs to around 94 million workers globally. 

While trends vary by region and country, nearly 60 per cent of garment workers globally are women, reaching nearly 80 per cent in some regions. Although completely illegal in most countries, according to International Labour Organisation (ILO), around 11 per cent of the readymade garment industry workers worldwide are children. 

Fast fashion had deteriorated the labour rights situation even further as it continuously looks for the cheapest source – giving unscrupulous RMG manufacturers a field day as they lure in people eager to find employment with false offers of a better livelihood.  Sofie Ovaa, global campaign coordinator of Stop Child Labour at UNICEF explains, “There are many girls in countries like India, Cambodia and Bangladesh, who are willing to work for very low prices and are easily brought into these industries under false promises of earning decent wages.”

Weak anti-slavery laws a bane

Meanwhile many countries have passed anti-slavery laws for compliance. For example, Canada has the ‘Fighting Against Forced Labour and Child Labour in Supply Chains Act’. But there are questions if the law is really effective and how robust it is. Going by the lax law, it hardly comes across as a fight for betterment that a first world economy would uphold and turns out to be more a moral code of conduct that should be followed. This Act does not make it mandatory for large Canadian companies that are outsourcing from various developing and under-developed economies where the chances of labour exploitation are on the higher side. It is entirely at the discretion of these organisations to choose to follow the Act as an ethical guideline or not. 

Similarly, the State of California has very weak and vague disclosure laws that enable large importers to carry on doing business with dubious suppliers, as do Australia and the UK. What is surprising is that in these countries, the movement towards ending labour exploitation in the fashion industry is led by individuals and groups of the public rather than their governments. 

Popular high street brands continue using child labour

Shocking as it may be, the list is a long and disturbing one as these are much-loved labels – H&M, Zara, Uniqlo, GAP, Nike, Aldo, Aeropostale, Urban Outfitters, Primark, Walmart and Forever 21, Victoria’s Secret and La Senza to name some of the many. Whilst most of these brands often espouse social causes such as sustainability, LGBTQIAA+ rights, etc., when it comes to speaking out about child labour, they remain vague. 

Child labour has been advantageous for the readymade garment and textile sector because most of the tasks involved require low skill and according to industry experts, little fingers pick better cotton because they don’t damage the fluff! According to SOMO, the Netherlands-based independent research company, the worst offenders happen to be Egypt, Uzbekistan, Pakistan, India, Bangladesh, Thailand and China. One can’t of course put the blame squarely on brands exploiting children for financial gains – the fashion supply chain is nearly impossible to control as of date because of the multiple sub-contractors in it who fly below the radar and buyers don’t have any idea about them. 

In April 2023, cotton yarn prices stood at $5,651 per tonne (CIF, Italy), down -9.8% from the previous month. The import price displayed a consistent decline, with August 2022 marking the highest growth rate at 14%, reaching a peak of $7,772 per tonne. However, from September 2022 to April 2023, average import prices remained stagnant.

Diverse price trends across nations

Significant price disparities were evident among major cotton yarn providers. Egypt commanded the highest price at $9,706 per tonne in April 2023, while Spain offered some of the lowest rates at $3,348 per tonne. Spain experienced the most growth from April 2022 to April 2023 (+0.8%), while other primary suppliers observed declines.

Variability in Italian cotton yarn import prices by type

The price of cotton yarn not intended for retail sale, containing 85% or more cotton, stood at $6,181 per tonne, while yarn with less than 85% cotton was priced at $3,370 per tonne. Notably, price fluctuations were notable based on product type, with retail-ready cotton yarn showing a slight growth rate (-0.6%) compared to falling prices of other items.

Italy's fluctuating cotton yarn imports

Italy's cotton yarn imports surged to 5.6K tonnes in April 2023, a 7.2% rise from March 2023. This growth was most pronounced in September 2022, with a 101% increase compared to the previous month. While the April 2023 imported cotton yarn value was $32M (IndexBox estimates), overall imports saw a notable decline. The exceptional 66% m-o-m growth in September 2022 marked the highest rate.

Dominant cotton yarn imports by type in Italy

In April 2023, Italy's prime import was cotton yarn (other than sewing thread), with 85% or more cotton content, accounting for 77% of all imports (4.3K tonnes). This significantly exceeded imports of cotton yarn with less than 85% cotton content, at 973 tonnes. Between April 2022 and 2023, imported cotton yarn not intended for retail sale declined at an average monthly rate of -3.6%. Other types displayed varying growth: cotton yarn (other than sewing thread), less than 85% cotton, not for retail sale (+0.7% per month), and retail-ready cotton yarn (+13.8% per month).