FW
"The 56th India International Garment Fair, (IIGF) 2016 was inaugurated by the minister of state for textiles, Santosh Kumar Gangwar at Pragati Maidan, New Delhi. In his address, the minister highlighted the need to strengthen the apparel exports. Given its employment and export capacity, the apparel industry plays a significant role in the country’s economy."
The 56th India International Garment Fair, (IIGF) 2016 was inaugurated by the minister of state for textiles, Santosh Kumar Gangwar at Pragati Maidan, New Delhi. In his address, the minister highlighted the need to strengthen the apparel exports. Given its employment and export capacity, the apparel industry plays a significant role in the country’s economy. Several new initiatives have been undertaken by the government under the leadership of Prime Minister Narendra Modi to make development participative and inclusive, in line with the core governance philosophy of ‘Sabka Saath, Sabka Vikaas’.
Need to focus on apparel exports
Rashmi Verma, Secretary Textiles, emphasized on the economic vision based on boosting manufacturing, growing exports and generating more and more employment. The idea is to embark on a path of inclusive and participatory growth. She explained that the objective is to showcase latest garment and fashion accessories trends shaping up. This sector being the highest employment provider in the manufacturing sector has a much bigger role and responsibility. India has the significant advantage of a young population offering huge potential for a demographic dividend by getting gainful employment in this sector with just three months of training, she added.
Ashok G Rajani, Chairman Apparel Export Promotion Council (AEPC) observed, that the garment export industry can generate 2,200 jobs with an investment of Rs 30 crores in land, building machinery and utilities. The unique feature of the industry is that with the Rs 30 crores investments, garment exports worth Rs 120 crores can be achieved, out of which, Rs 30 crores would go as wages to the workers. The textile industry accounts for 14 per cent of industrial production, which is around 4 per cent of India’s GDP. Out of 45 million people in the textile industry, 11.22 million people are in garment sector alone. Nearly 60 to 70 per cent workforce is of women, mostly from the weaker sections of the society. The garment export sector is currently worth $17,000 million, having a world market share of around 3.5 per cent only, he added.
Rajani said the 56th IIGF has attracted 809 buyers from across the globe, of which 259 have availed MAI benefits; there are 350 buying agents and 200 visiting buyers for the 56thIIGF. There are 322 participants for the 56th IIGF and number of buyers registered on the IIGF website is 1720. This data shows that the buyers across the world have stated showing faith and sees India to be a safe and compliant destination for sourcing garments, he said.
Expressing the concerns of garment export industry, he said they are concerned about Vietnam’s zero duty access to EU market. Vietnam exports are likely to grow faster due to implementation of zero duty from 2017. (India faces import duty of 9.6 per cent). Trans Pacific Partnership Agreement allows export opportunities in Vietnam to US with a benefit of 17-30 per cent export duty relief. India-EU Broad-based Trade and Investment Agreement (BTIA) are yet to be finalized, exporters are expecting faster conclusion of the talk so that they can compete with Bangladesh and Vietnam.
Talking about garment exports growth Rajani said, RMG exports were to the tune of $1,440.8 million in December 2015 with an increase of 5 per cent against the corresponding month of December 2014 which was $1,372 million. India’s RMG export to World in April-December of 2015-16 was to the tune of $1,2473.9 million which is up by 2.8 per cent compared to the same period of previous financial year. During April-December 2014-15, India’s apparel exports were to the tune of $1,2137.1 million. Rajani also requested the government to simplify the labour laws, which is the need of the hour.
Organised by AEPC, IIGF is India’s largest garment show in South Asia, covering Apparel and Fashion Accessories; encompassing a vast exhibition area of around 15824 square meters.
A State Bank of Pakistan (SBP) study says, Pakistan textile exporters are losing their share in the US market as compared to competitors. In its first quarterly review released recently, the central bank said that in the US market overall import demand for textiles and apparel increased during July-September 2015, however, Pakistan had not been able to firm up its exports.
The study observed that the market for manmade fiber products is expanding at a fast pace, but Pakistan has failed to diversify its product range accordingly as a result, Pakistan has now begun to lose its share even in the cotton apparel market of the US. The SBP said that textile exports continued to face subdued global demand. The cloth manufacturing progressed slowly due to depressed demand from the European market.
The report added, in the yarn segment, availability for cheaper yarn from India posed serious challenges to local manufacturers. “However, the situation is expected to improve, as the government has imposed 10 per cent duty on yarn imports from November 1, 2015.” Pakistan’s textile exports registered a decline of 5.6 per cent during the first quarter of 2015-16 mainly due to shrinking global demand. The overall imports of textile and clothing of the European Union declined sharply during the period under review.
However, in the clothing segment, all major countries faced a decline in exports to the EU, except Pakistan and Bangladesh. These two countries enjoy duty-free access to this market: Pakistan in terms of GSP+ and Bangladesh via Everything-But-Arms (EBA), the SBP report said.
The devaluation of the yuan has caused jitters among garment exporters in India. Garment exports from China will get an impetus as more and more buyers will source products from there since they could become cheaper. Already, China is the leading exporter of textiles and clothing in the world.
In contrast garment exporters in India like the knitwear cluster face rising production costs and shrinking profit margins. Tirupur knitwear cluster imports large chunks of machinery, raw materials like knitwear printing inks and accessories that provide embellishments to the garments.
Rupee volatility has been a problem for the last few months. If the rupee continues to slide, it can upset the costing of end products as garment orders usually take a few months to execute. Since currency markets cannot be controlled, Indian exporters want incentives that will arrest any further widening of the trade deficit and help them remain competitive. They feel rates of duty drawback and interest subvention can be increased and more sops be given to increase exports to focus markets so as to enable exporters to increase their market share. China further devalued the yuan against the dollar a few days back, setting the daily reference rate to the lowest since 2011.
Korea’s Dongyang MirAcle successfully developed ‘Ultra High Molecular Weight Polyethylene (UHMWPE) yarn,’ one of the strongest among synthetic fibers which have led Korea's technical textile industry. It established the research center in 2007 to develop high tenacity fiber, new material fiber and automation facilities. An official of the Dongyang MirAcle explained that MirAcle which has been produced through gel spinning has specific strength 15 times higher than steel wire, and it has excellent UV resistance and chemical resistance. He added that since it has an excellent abrasion resistance and can be used in extremely harsh conditions, the scope of application will be widened.
Dongyang claims to be the only company in the world which can supply HDPE yarns in all range of tensile strength since it has developed not only gel spun UHMWPE yarn, MirAcle but also melt spun HDPE yarn.
Owing to the limitation of domestic technology, the UHMWPE yarn and melt spun HDPE yarn were all imported. Since the import volume was limited, the development of new applications using high tenacity HDPE yarns has been too slow. However, the MirAcle which has excellent quality compared to other companies was specialized in order to develop customized products by supplying excellent tenacity, creep characteristics, coating performance and customized specification.
The developed product can be applied to military supplies such as bulletproof jacket and bulletproof helmet, leisure and sports goods, and used for high performance rope, high performance fishing net, industrial safety gloves, protection gears, mountain bike frame, rock climbing rope, paragliding, fiber reinforced concrete, high performance motorcycle helmet, baseball stadium net, dental floss, gastro scope wire, industrial fabric, non-woven fabric, staple fiber and suture, etc.
Asia Apparel Expo will be held in Germany from February 24 to 26, 2016. About 250 companies are participating in the expo. Among the participating countries are: Hong Kong, China, Bangladesh, Pakistan, Myanmar, Thailand, India, Cyprus, Belgium and Poland.
The expo is designed to meet the demand from European customers for finished garments, contract manufacturing and private label development. The apparel products on show cover men’s, women’s and children’s wear, sportswear and work wear, fabrics and textiles, as well as trimmings and accessories from the carefully-selected factories.
For the fourth edition in February 2015, over 1,500 trade professionals attended, many of whom repeated their visits over the three days, reinforcing that the well-edited selection and variety of factories and suppliers is a convenient sourcing center for apparel buyers.
Asia Apparel Expo will continue to expand its role in providing European buyers with the opportunity to meet with potential new suppliers and learn of the most up to date sourcing and production information from Asia.
The event will feature a sustainable fashion design competition. The goal of the competition is to inspire emerging fashion designers and students from Asia and Europe to create high fashion pieces with minimal waste, utilizing zero-waste, up-cycling and reconstruction design techniques.
www.asiaapparelexpo.com/
Première Vision Paris will open its doors from February 16 to 18, 2016 in a complex and still unstable economic and political context. Facing continually weakened global apparel consumption, both in traditional as well as new markets, Premiere Vision Paris continues to demonstrate its strength, and the strength of its concept. With 1,720 exhibitions and six complementary activities, Première Vision Paris plays strength and a transversal approach to the global creative fashion industry.
The 1,720 exhibitors include: spinners, weavers, accessory makers, design studios, tanners and garment manufacturers. They are presenting their latest creative developments to the many buyers, stylists and fashion and accessory brand designers who come each season to Première Vision Paris to find inspiration and unearth innovative collections that will make a difference to their collections.
Following a record show in 2015, this time the number of global exhibitors is 4 per cent lower, down from 1,793 exhibitors in February 2015. This figure remains nonetheless quite high and is exceptional for the industry as a whole. Among the offers proposed at the various international shows targeting the upstream sector, the Première Vision Paris event is unquestionably the most complete, the most international and the highest in quality.
India is interested in signing a free trade agreement with the European Union. India and EU had started talks for the FTA, dubbed Bilateral Trade and Investment Agreement, in 2007 and the last meeting was held in October 2014. Till now, 16 rounds of negotiations have taken place. India has agreed on many issues such as permitting 49 per cent foreign direct investment in insurance sector, 100 per cent foreign direct investment in telecom and easing of foreign investments norms in the banking sector. A model bilateral investment treaty has been approved by India.
India has expressed her willingness to conclude a balances agreement with the EU. The trade in goods between India and EU was $98.5 billion in 2014-15. India has raised the issue of data security status, Mode-4 ceilings (movement of professionals), seamless intra-corporate movement and real market access in terms of sanitary and phyto-sanitary (norms related with plants and animals), and technical barriers to trade measures adopted by the union, while Europe wants a duty cut on automobiles, wines and spirits. However, discussions were stalled amid the downturn in Europe and the EU’s focus on concluding the transatlantic trade and investment partnership agreement with the US.
Bangladesh is aiming for sustainable growth of exports of textile and leather goods. A fund has been established for the purpose. Only borrowers who keep their factories green will be eligible for loans for the import of factory related capital machinery. The $200 million fund is called ‘Green Transformation Fund’. Export based textiles and leather industries need to maintain their factories environment friendly and conform to norms. They have to follow the criteria of water use efficiency in wet processing, water conservation and management, waste management, resource efficiency and recycling, renewable energy, energy efficiency, heat and temperature management, air ventilation and circulation efficiency, work environment improvement initiatives and other fields as identified may be included from time to time.
The loan period will be from five to 10 years with a one year grace period. Interest accrued for the grace period will be repaid in equal quarterly repayment without compounding. Many Bangladesh leather goods and footwear manufacturers and exporters already use solar panels, air ventilation and heat management. A leather industrial park will have an effluent treatment plant. Manufacturers feel the process of getting funds should come under fine tuning to make the process easier and less complex.
Denmark is going to launch a strategic sector cooperation project on improving the health and safety of workers in Bangladesh by strengthening labor authorities. The three- year cooperation between the two countries aims at supporting capacity development of labor authorities focusing in particular on occupational safety and health in the readymade garment sector.
Bangladesh hopes to become a middle income country by 2021 and for that it’s necessary to improve the framework condition and productivity of the readymade garment sector in Bangladesh. The focus of the agreement is to ensure a better and more sustainable production in Bangladesh.
The cooperation also includes building two specialised hospitals for treating occupational diseases workers suffer from. Currently, 60 Danish companies are in operation in Bangladesh. Denmark has a great trade deficit with Bangladesh and it is interested in investing in renewable energy and the water sector.
Denmark feels that for the last two years there has been a strong focus on Bangladesh’s clothing industry, and rightly so, but that there are also other industries that are contributing to Bangladesh’s economy like the leather and shipbuilding industries and that have great potential.
Denmark is one of Bangladesh’s leading development partners that currently works in areas like water, sanitation, agriculture, human rights, and development sectors.
"Adding to the worry of global brands and retailers, China’s textile and apparel companies are actively seeking business opportunities in the domestic retail market. Apparel retail sales in China reached 893.6 billion yuan in 2014 (around $137.5 billion), among which 30.77 per cent were sold online (up from 14.54 per cent in 2011). Although industry reports suggest apparel retail sales in China's Tier i and Tier II cities achieved almost zero growth in 2014, partially reflecting the negative impact of retail price increase on consumers' demand. But apparel retail sales in China's Tier III and IV cities and rural areas remain robust." opines Dr Sheng Lu."
China’s rising production cost and structural changes in the textile and apparel industry remain a major concern for global fashion retailers and brands. Although few other lower-wage countries can beat China in terms of industry integration, supply chain efficiency, and reliability however, it seems that the country’s production capacity remain unparalleled. As per 2014 statistics and information collated by Dr Sheng Lu, Assistant Professor at University of Delaware quoted in his blog, textile fiber production in China exceeded 50 million tons, accounting for 54.36 per cent of world share. By 2013, as much as 64.2 per cent of the world's chemical fibers, 64.1 per cent of synthetic fibers and 26.2 per cent of cotton were produced in China. Given China's vast production capacity, it will continue to be the top apparel sourcing destination for most EU and US fashion apparel companies for many years to come. Even Vietnam, the emerging sourcing hub also remains far behind with its apparel production recorded 2.85 billion units in 2015, which was only around 10 per cent of China's production.
Policy shift in China’s textile industry
Moreover, the global supply chain flow would also see the impact of China’s production policy shifting towards more value added and technology intensive textile products. Due to this structural adjustment, total industry output, the ratio of apparel, home textiles and industrial textiles has turned from 51:29:20 in 2010 to 46.8: 28.6: 24.6 in 2014. Further to overcome the pressure of rising labor and production cost, China's textile and apparel manufacturing base is gradually moving from the east coast to the western and central part of the country . Increasingly, China’s textile and apparel players are investing more on research and development shifting its focus from production volume.
Adding to the worry of global brands and retailers, China’s textile and apparel companies are actively seeking business opportunities in the domestic retail market. Apparel retail sales in China reached 893.6 billion yuan in 2014 (around $137.5 billion), among which 30.77 per cent were sold online (up from 14.54 per cent in 2011). Although industry reports suggest apparel retail sales in China's Tier i and Tier II cities achieved almost zero growth in 2014, partially reflecting the negative impact of retail price increase on consumers' demand. But apparel retail sales in China's Tier III and IV cities and rural areas remain robust, opines Dr Sheng Lu in his blog.
Companies following the traditional business model of manufacturing and exporting are facing their most difficult time since the 2008 financial meltdown. However, a number of apparel companies are now focusing on function upgrading. However, China's textile and apparel industry has witnessed slow growth specifically, output of China's textile and apparel industry grew only 7.0 per cent between 2013-2014, recording a significant drop from 10.3 per cent between 2009-2010. Experts believe given the downward pressure on China's economy and uncertainties in the world marketplace, such a slow-growth pattern are likely to continue in the years ahead.
