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Sri Lanka's vital apparel export sector faces potential disruption as the Joint Apparel Exporters Association Forum (JAAF) has raised serious concerns about the government's proposed removal of the Simplified Value Added Tax (SVAT) system. A hasty transition without a robust, well-tested alternative could trigger significant cash flow problems for exporters, jeopardizing the industry's stability, warns JAAF.
The core issue revolves around the VAT refund process. Under standard VAT regulations, exports are zero-rated, allowing businesses to reclaim input VAT. However, chronic delays in refunding these credits in Sri Lanka forced the adoption of the SVAT system. Now, the government's plan to replace SVAT with a risk-based refund mechanism has triggered alarm bells within the apparel industry.
JAAF had previously championed a digitally driven VAT refund solution, emphasizing efficiency and transparency through minimal human intervention. The association fears that a poorly managed transition will strain exporters' cash flow, disrupt operations, and tarnish Sri Lanka's reputation as a reliable sourcing destination, particularly in a global market where supply chain stability is paramount.
The apparel sector's contributes over 40 per cent to the nation's total merchandise exports. Maintaining the industry's competitiveness and boosting investor confidence hinges on a seamless and transparent transition from SVAT. JAAF emphasizes on the importance of timely VAT refunds and a reliable mechanism to prevent delays, safeguarding exporters' liquidity.
The association urges the government to engage closely with industry stakeholders, ensuring a smooth VAT transition that incorporates efficient digital refund processing to prevent disruptions.
Despite these concerns, JAAF welcomes the government's inaugural budget, recognizing its focus on export-driven growth, investment facilitation, and policy consistency. The budget's commitment to economic stabilization and a competitive business environment is seen as a positive step for the textile and apparel sector.
JAAF also applauds the government's efforts to expand Free Trade Agreements (FTAs), align with the industry's strategic goals of protecting market access, and pursue new global partnerships. Initiatives like the National Single Window, e-cargo tracking, and customs law revisions are deemed crucial for enhancing the ease of doing business. Measures such as revisiting the Economic Transformation Act and introducing the Investment Protection Bill are expected to bolster investor confidence and propel export growth.
While expressing optimism about the budget's direction, JAAF reiterates its apprehensions regarding the SVAT removal. They emphasize the necessity of a well-tested alternative, a smooth transition, and continuous engagement with industry stakeholders to ensure policy decisions reflect the realities of the business environment. Clarity on tax administration, timely trade facilitation, and sustained focus on export competitiveness are vital for achieving ambitious export targets.
As Sri Lanka strives for sustainable economic recovery, the apparel industry remains committed to collaborating with policymakers to implement effective reforms, ensuring the nation's export sector remains resilient and globally competitive.
Bangladesh's ready-made garment (RMG) exports saw a robust rebound in the H1, FY25, with shipments rising to all major markets. Total RMG exports by the country from July-December 2024 increased by 13.28 per cent Y-o-Y to $19.89 billion as against $17.56 billion during the corresponding period of the previous year.
The European Union (EU) remains the largest market, absorbing approximately 50 per cent of Bangladesh's total garment exports. EU imports rose by 15.22 per cent to $9.87 billion with imports by Germany rising by 14 per cent to $2.47 billion and imports by France expanding by 10 per cent to $1.09 billion.
Accounting for 19 per cent of Bangladesh’s total RMG exports, the US’ imports increased by 17.55 per cent to $3.84 billion. This growth is attributed, in part, to US tariffs on goods from other countries, leading buyers to explore alternative sourcing options in Bangladesh. Imports by the United Kingdom increased by 6.70 per cent to $2.16 billion while imports by Canada rose 14 per cent to $640 million
Despite these positive export figures, the RMG industry in Bangladesh continues to face significant challenges. Highlighting the issue of low prices offered by buyers, despite rising production costs, Mohammad Hatem, President, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), points out, domestic textile mills in Bangladesh continue to struggle due to gas and electricity shortages, leading to increased reliance on imported yarn. Furthermore, banking and law and order issues hinder continued export growth, he adds.
The hum of consumer-driven economy is faltering, and the reverberations are hitting luxury retail with a force that suggests a deeper shift in consumer culture. While inflation fatigue grips many, it's Gen Z's ‘No Buy 2025’ movement that's sending shockwaves through the market, signaling a potential era of prolonged austerity.
The rise of underconsumption
What began as a murmur of ‘underconsumption’ has grown into a social media phenomenon. Driven by economic anxieties and a yearning for authenticity, young consumers are actively choosing to forgo discretionary spending, prioritizing essentials over extravagance. This movement, which got a boost on platforms like TikTok, has garnered millions of views, demonstrating a widespread desire to break free from the cycle of relentless consumption.
Luxury's sudden slump
The impact is palpable, particularly in the luxury sector. LVMH's recent financial report, revealing a 2 per cent sales decline and significant drops in net income, serves as a stark illustration of this trend. Analysts like those at McKinsey & Company, warn of a potential ‘reckoning’ for brands, citing factors like a slowing global economy and evolving consumer habits. Stéphane JG Girod, a Swiss-based professor, further emphasizes this structural shift, noting that luxury brands have lost an estimated 50 million customers in the past two years, with notable impact to brand like Rolex and Porsche.
One major factor behind this mindset is the economic uncertainty. Geopolitical tensions and concerns about asset values are driving even affluent consumers to adopt a more cautious approach. For younger generations, particularly those living paycheck to paycheck, the ‘No Buy’ movement reflects a sense of financial vulnerability and a desire for greater security.
Moreover, Gen Z's embrace of movements like ‘No Mow May’ and ‘No Buy 2025’ underscores a growing preference for authentic experiences and sustainable practices. The influence from social media is massive, with Gen-z consumers finding others like themselves that reinforce their values and opinions. Young consumers are prioritizing low-cost experiences like eating in and hosting game nights, indicating a move away from material possessions. Many reports say, Gen-Z values experiences much more than material goods.
Gen Z's influence extends beyond their own purchasing power. Their ability to sway the spending habits of older generations through social media makes them a crucial demographic for retailers to watch. As consumer culture shifts, brands, from Walmart to Ferragamo, must adapt to meet the evolving needs and values of their customers.
The bottomline is the ‘No Buy 2025’ movement is more than a fleeting trend; it reflects a fundamental shift in consumer behavior. Economic uncertainty and a desire for authenticity are driving forces behind this movement. And luxury retail is particularly vulnerable to these changes. Social media is a huge driving force in this cultural change. Most importantly, brands must prioritize understanding and responding to the values of Gen Z.
So is this a temporary blip or a harbinger of a new era of conscious consumption? Regardless, the retail landscape is undoubtedly undergoing a transformation, with Gen Z leading the charge.
The Ellen MacArthur Foundation’s Fashion ReModel project, now backed by a $1.5 million investment from the H&M Foundation, is accelerating circularity in fashion. The initiative, launched last May, aims to decouple revenue from production and resource use while scaling up circular business models like recycling, rental, repair, and resale.
Brands including Reformation, Primark, and H&M Group’s Arket, Cos, and Weekday have set targets to increase revenue from circular efforts over the next three years. The project will share annual updates, highlighting progress and challenges.
Circular business models, once niche, are proving highly lucrative. In 2019, they represented a $73 billion market, with potential to reach 23 per cent of the fashion industry by 2030 a $700 billion opportunity, according to the Ellen MacArthur Foundation.
For fashion to achieve circularity, both products and business models must be redesigned. The initiative's framework, shaped by over 150 stakeholders, focuses on key areas such as finance, policy, climate, and marketing to drive industry-wide transformation.
Workstream insights will be published annually, with plans to expand Fashion ReModel by mid-2025. A comprehensive progress report is slated for 2028.
As brands work to move beyond the take-make-waste model, the project aims to accelerate circular solutions, tackling emissions and fostering a more sustainable fashion future.
The flagship company of LNJ Bhilwara Group, RSWM was awarded with 1st Runner-Up award in the ‘Innovative Water Management and Conservation’ category at the CITI Textile Sustainability Awards 2024-25.
Presented at Bharat Tex 2025, India’s largest textile trade fair, held from February 14-17, 2025 at Bharat Mandapam, New Delhi, this prestigious award acknowledged RSWM’s pioneering efforts in water conservation and strengthening its leadership in sustainable textile manufacturing. The awards were presented by Pabitra Margherita, Union Minister of State for External Affairs and Textiles, Govt of India, alongside Rakesh Mehra, Chairman, CITI, and other key dignitaries.
Water conservation is a critical priority for RSWM. Over the past three years, the company has invested $10.1 million (Rs 84 crore) in advanced water management technologies across its manufacturing facilities. A few initiatives launched by the company include implementing Zero Liquid Discharge (ZLD) systems for 100 per cent wastewater recycling, and adopting low-liquor HTHP fiber and yarn dyeing machines, which reduce water consumption by up to 50 per cent compared to traditional methods. PLC-controlled auto-controllers have further optimized water usage in dyeing processes, minimizing waste and reducing processing time.
Additionally, RSWM has incorporated counter-current washing techniques for multi-stage water reuse and innovative moisture extraction methods in stenter machines, reducing both water and energy consumption. With 24 rainwater harvesting wells and artificial lakes, the company has also enhanced groundwater recharge, supporting both industrial and community water needs. These combined efforts have resulted in annual water savings of 61.7 million gallons (233,500 KL), setting a new standard for sustainable water management in the textile industry.
Expressing his gratitude for the award, Rajeev Gupta, Joint Managing Director, RSWM, states, the company focuses on sustainably produced products by combining advanced technology with environmental stewardship, reducing their water footprint while maintaining high-quality production.
At Bharat Tex 2025, RSWM showcased its sustainability-driven innovations under the ‘Panchtatva’ theme, featuring eco-conscious and high-performance textiles. The highlight of this showcase include fire-retardant, UV-resistant, and heat-protective fabrics (Fire), organic and biodegradable textiles (Earth), moisture-wicking and water-repellent materials (Water), breathable and anti-odor yarns (Air), and high-tech graphene-enhanced fabrics (Space). Standout products included anti-odor functional yarns, lightweight denim, flame-resistant textiles, water-repellent denim, and Dyneema® fibers. The company received an overwhelming response for its products, reaffirming RSWM’s leadership in eco-conscious and high-performance textile solutions, driving the future of sustainable fashion and functional fabrics.
Experiencing significant growth, Egypt’s clothing exports to the United Kingdom rose to $101 million in 2024. Representing a remarkable 53 per cent increase over the past five years, this growth signals a rising global demand for Egyptian-made garments.
This achievement also positions Egypt as the seventh-largest supplier of apparel to the UK, according to data released by the Ready-Made Garments Export Council. As per figures from the Central Agency for Public Mobilization and Statistics, Egypt’s total clothing exports increased to approximately $2.526 billion in the first eleven months of 2024 from the $2.174 billion recorded during the same period in 2023. This not only highlights the robust growth of the Egyptian garment industry on the global stage but also demonstrates the strength of the Egyptian garment industry in the international market.
Currently, Egyptian companies are participating in the prestigious Fashion London exhibition, a key event in the international fashion industry. This platform brings together leading brands and designers, offering Egyptian businesses a prime opportunity to showcase their latest products and stay abreast of global fashion trends. At the exhibition, Egyptian firms are unveiling new designs specifically tailored for international markets and engaging in bilateral meetings with major importers, aiming to further expand their export reach.
The prices of viscose yarn in India have increased significantly due to persistent supply shortages and the weakening of the Indian rupee. These factors have driven up costs for manufacturers, particularly in major textile centers like Mumbai and Surat. The rise in viscose yarn prices is occurring against a backdrop of volatile demand, influenced by market conditions, seasonal changes, and global supply chain disruptions.
The viscose yarn market has been struggling with limited availability, further compounded by supply chain disruptions resulting from global challenges. Manufacturers are facing difficulties in sourcing raw materials, leading to a squeeze in yarn supply. This situation has resulted in elevated prices, making viscose products more expensive for consumers.
Conversely, polyester yarn markets, especially in Ludhiana, have remained relatively stable despite challenges such as payment delays and weak demand. This stability is attributed to fewer disruptions in polyester production compared to viscose.
Additionally, the cotton yarn market has seen slight price increases as mills shift towards domestic cotton supplies, which are proving to be more reliable amid global disruptions.
This rise in viscose yarn prices underscores the ongoing instability in India’s textile market, with manufacturers adapting to persistent challenges while attempting to balance supply and demand. This situation mirrors broader trends in global textile production, emphasizing the need for sustainable and resilient practices within the industry.
The viscose staple fiber business of the Aditya Birla Group, Birla Cellulose is venturing into the production of viscose fibers enhanced with graphene for use in textile manufacturing. The company has entered into a joint development agreement with the Bhilwara Group Companies in collaboration with Grasim Industries to develop this project.
As per this agreement, Birla Cellulose will partner with two divisions of the Bhilwara Group Companies to develop these enhanced fibers, as reported by Apparel Resources. A specialist in advanced materials, TACC will provide graphene derivatives to Birla Cellulose for yarn production. Subsequently, textile manufacturer RSWM will utilize these graphene-enhanced viscose fibers to create textiles.
Renowned for its strength, durability, and lightweight properties, Graphene is expected to significantly improve textile performance. By incorporating graphene, the companies aim to produce fabrics that are exceptionally durable, resilient, and offer superior heat regulation.
A flagship company of the Aditya Birla Group, Grasim Industries specializes in the production of cellulosic fibers, textiles, and yarn, operating on a global scale, according to its official website. Established in 1947, Grasim Industries also encompasses cement and chemical divisions. In FY24, Grasim Industries reported consolidated net revenue of Rs 1.3 trillion (approximately $15.6 billion), with earnings before interest, tax, depreciation, and amortization totaling Rs 208.37 billion (approximately $2.5 billion).
The 56th edition of Texworld Apparel Sourcing Paris concluded on a high note, attracting more than 8,500 visitors and strengthening its position as Europe’s top sourcing event for fashion textiles and clothing. Held from February 10 to 12, 2025, at the Paris-Le Bourget Exhibition Centre, the trade fair saw a 10 per cent increase in attendance compared to February 2024. Over 1,250 exhibitors from 32 countries showcased their products, making the event a key platform for business connections and industry insights.
Paris as a global sourcing hub
Texworld Apparel Sourcing Paris has become an essential meeting point for designers, buyers, and suppliers in the fashion industry. The event reinforced Europe’s significance in global fashion, with the top five visiting countries being France, the UK, Italy, Spain, and Germany. Many international buyers returned after years of market adjustments, highlighting Paris’s resilience in a shifting fashion landscape. While French buyer participation remained stable, the increased international presence underscored the city's enduring importance in global sourcing.
According to Julien Schmoll, Marketing and Communications Director at Messe Frankfurt France, the industry is undergoing a transformation, shifting from budget-focused products to higher-quality offerings. “We have redesigned our trade fairs to cater to mid-range market needs, ensuring a diverse, enriched, and cutting-edge selection at competitive prices,” he said. The event provided an ideal environment for productive business discussions and trend analysis.
Growing interest in African sourcing
A major highlight of the event was the growing interest in African textile sourcing. Ethiopian manufacturers made strong connections with European brands, reflecting the region’s increasing appeal as a sourcing alternative. Maryse Mbonyumutwa, founder of Rwandan sustainable manufacturing platform Pink Mango, engaged in promising discussions with European representatives. “We’ve had encouraging conversations with brands looking to collaborate locally,” she stated.
Buyers and exhibitors reported three days of active engagement. Bangladeshi manufacturer NZ Denim met nearly all its European clients, including Celio, OKaïdi, Kiabi, and Jules. “The show allows us to discuss future materials directly with design teams,” said Najam Us Saqib, the company’s R&D manager. One innovation that drew significant interest was the naturally colored cotton, Ackala Coton, showcased during the Econogy Tour, a dedicated program highlighting companies committed to ecological and social standards in the textile sector.
A platform for all market segments
Texworld Apparel Sourcing Paris welcomed buyers across various market segments, from mainstream brands to haute couture. A materials manager from a major French clothing brand noted that the event provided opportunities to connect with Indian, Turkish, and Chinese suppliers while scouting materials for future collections. Haute couture designers Livia Stoianova and Yassen Samouilov of On Aura Tout Vu also explored options for an upcoming show production. “For a first visit, we discovered some very interesting and creative materials,” they said.
The next edition of Texworld Apparel Sourcing Paris is scheduled for September 15-17, 2025, at Paris-Le Bourget Exhibition Centre. The event will feature key sectors such as Avantex and Leatherworld, continuing its role as a vital marketplace for the fashion industry.
Source Fashion, Europe's leading responsible sourcing show, wrapped up another successful edition with a remarkable 32 per cent increase in visitor numbers. Now in its third year, the event continues to serve as a key platform for retailers, brands, and wholesalers seeking ethical and responsible manufacturing partners worldwide. This year’s show attracted major retailers, fashion houses, and even sports brands like the NBA and West Ham Football Club, demonstrating its broad industry appeal.
Growing global participation and positive exhibitor response
Over 200 exhibitors from 20 key sourcing regions, including Turkey, Taiwan, Ethiopia, Egypt, China, India, the UK, France, Hong Kong, and Portugal, participated in the event. Leading brands such as John Lewis, Harrods, Next, Asos, Stella McCartney, River Island, Boohoo, and Barbour attended, highlighting the growing importance of responsible sourcing. Exhibitors praised the event for its ability to connect businesses with key buyers, helping them secure long-term partnerships.
Parneet Kaur from Achiever Apparel (India) noted strong engagement: “We’ve seen high footfall and have reconnected with previous clients while meeting new ones. The event builds trust, and it’s great to support both big players and emerging brands.” Luis Oliveira, CEO of Wonder Raw (Portugal), emphasized sustainability’s growing influence: “Sustainability is everywhere, and we should all be concerned about our footprint. This show connects us with like-minded businesses and ethical production partners.”
Industry leaders drive sustainability conversations
Beyond sourcing, Source Fashion has positioned itself as a thought leader in sustainability and supply chain management. Its content program, spread across two stages - The Source Catwalk and Source Debate Stage, offered insights into sustainability, supply chain risk, international trade, and innovation. Discussions tackled pressing industry challenges, from supply chain transparency to circular fashion solutions.
Caryn Franklin MBE, a fashion activist, underscored the event’s impact: “Source Fashion is where I learn and gain knowledge outside my expertise. It’s empowering to see experts shaping the future of sustainable fashion.” Simon Platts, Founder of SP&KO Consultancy, highlighted the event’s rapid growth: “It’s moved on significantly in just six months. The show is about building a community across sourcing, design, tech, and sustainability, ensuring it remains relevant to industry needs.”
One of the standout sessions explored how the fashion industry can bridge the talent gap by better aligning academia with industry needs. Experts from Next and Vollebak emphasized the importance of fostering graduate involvement to create a skilled, sustainability-conscious workforce. Another key discussion led by Sasha McFarlane of Future-Proof Fashion focused on Project Interlace, a six-month initiative aligning supply chains with demand signals to reduce overproduction and waste.
A must-attend event for ethical sourcing
Suzanne Ellingham, Event Director of Source Fashion, celebrated the show’s success: “We have built a trusted buying platform that not only promotes responsible sourcing but also drives job creation, education programs, and stability in manufacturing communities. This show has created a game-changing impact in just three years.”
With its growing influence and expanding community of sustainability-focused businesses, Source Fashion has become a must-attend event for industry leaders. The next edition will take place from July 8-10, 2025, continuing its mission to transform fashion sourcing for a more responsible future.
