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Chinese goods threaten Ludhiana hosiery sector
Jan '16
Ludhiana’s famed hosiery industry is facing an onslaught from its Chinese counterpart with winterwear from Asia’s largest economy flooding the local market. Chinese sweaters, caps, mufflers, and blankets have become the rage in and around Ludhiana, according to a newspaper report.

The key markets for hosiery industry are Punjab, Haryana, Delhi, Himachal Pradesh, Uttar Pradesh, West Bengal, Chhattisgarh, Jammu and Kashmir and some North Eastern states.

Ludhiana is one of the oldest hosiery clusters in the country and is famous for winter garments like jackets, sweaters, thermals, pullovers, inners, shawls etc.

Businessmen say that better look and material quality of Chinese products, a large variety of designs and cheap prices which are around 15 to 20 per cent less than locally made products have meant that Chinese hosiery items have occupied around 20 per cent of the Ludhiana market.

Upkar Singh Ahuja, General Secretary of Chamber of Industrial and Commercial Undertakings (CICU) said, “There are many reasons for the increasing share of such items in the market. First, they are of better quality due to high-class machinery. Then, the Chinese government promotes technological advancements. If local industrialists want to install high-tech machines, they have to pay an interest of 10-13 per cent, whereas in Japan, it is 3 per cent, and in China, the loan is interest-free. If Made in China goods have occupied a sizeable share in the local market, one expects that it could be much higher in the markets of coastal cities like Chennai, due to less freight charges."

He also said the government must promote hosiery industry and make impressive schemes for them to make it world-class.

But the Chinese goods aren’t the only headache for Ludhiana’s hosiery industry. Ahead of the current cold wave in north India, above-normal temperature in Punjab hit the hosiery and shawl industry badly with lower offtake of winter garments.

Despite 20-25 per cent lesser production this year by Ludhiana's hosiery industry on the back of old stock, sales have been lukewarm up to the middle of January when winter temperatures were above normal.

Ahead of the cold wave, lower demand for winter garments forced retailers to offer heavy discounts on hosiery items much earlier to clear their stocks, adding to industry's woes which have complained of not getting repeat orders from wholesale agencies and retailers. (SH)

Fibre2Fashion News Desk - India

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