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India’s apparel production dips 10 months in a row

India’s apparel production fell 4.7 per cent in February. This is the tenth straight monthly decline in apparel production. Several unresolved issues like the reduction in duty drawback and RoSL after the imposition of GST, capital blockage due to slow GST refunds and uncertainties on the future of export subsidies have affected industry sentiments. Speaking about the decline in production, HKL Magu, Chairman, Apparel Export Promotion Council (AEPC) says, “Apparel manufacturing is clearly in recession as the latest production figures shows a decline of 4.7 per cent in apparel production.”

Global demand positions are good and the industry is keen to take up more orders but cost disadvantages are affecting India's relative position as a sourcing destination. IIP stats reveal there has been a month to month decline in apparel productivity. From positive growth of 1.3 per cent in April 2017, May saw a fall of five per cent. In June, the decline was 3.2 per cent while in July, it was 5.1 per cent. In August, September, October, November and December the industry recorded a decline of 6.4 per cent, 7.2 per cent, 11 per cent, 13.1 per cent and 13.5 per cent respectively. In January, apparel production recorded a dip of 10.7 per cent.

For April-February 2017-18 the decline has been 9.9 per cent. Business is there but buyers want fast track suppliers. Fast fashion dictates trends. Indian exporters don’t have a great infrastructure and most can’t supply in a short span of time.