Fibre2Fashion brings to you 10 select developments from 2017 that we believe will have a bearing on the textiles-apparel-fashion industry in the days to come. By Subir Ghosh
Not always do big-ticket events or headline-grabbing incidents dominate the developments over a calendar year; more so in the textiles and apparel industry where the throwing of a stone into a pond creates ripples years later. On the other hand, quite often in fact, there are silent developments that tend to have a bigger long-term impact on the fashion scheme of things. The year gone by was one such phase, with many key developments of 2017 not causing a stir.
1) Digitalise, or be done with
Unless one is consciously cued in, developments on the information technology front are becoming increasingly difficult to keep track ofsuch is the frenzied pace of advancement. This, however, is only the first of the problems. What renders all this even more difficult to gauge is that developments are taking place all the time at various levels, in innumerable directions, and through varied means. The task becomes more gruelling since the sum of all these factors would be true for an industry only at one point in time. As had been pointed out earlier in this magazine, what was considered futuristic even at the turn of the millennium is old hat now, relegated to the footnotes of history. Among many of the technologies that are turning out to be disruptors, blockchain is set to become the most powerful of them all. The big brands have welcomed the development since they can now tackle counterfeiting at a different level, and cement loyalty among customers, besides speeding up the supply chain. Moreover, law enforcement agencies will find it easier to nail culprits. Yet, the embracing of blockchain has been rather slow in industry, and is yet to become the talk of the town. Looking at it from a different angle, all this would lead to nothing unless intergovernmental agreements are put in place in a globalised world where the supply chain cuts across borders. Industry reports have already pointed to the fact that digitalisation would mean zilch unless it comes with the right human intervention. There have been a quite a few disasters related to artificial intelligence that together serve as a word of caution. With the textiles-apparel-fashion industry notoriously slow in adapting to emerging technologies, it is the technology companies that are increasingly calling the shots, at least in terms of distribution as well as customisation. How things shape up in the near future will depend considerably on who calls the shots eventually: the textiles-apparel-fashion industry, or its technology cousins.
2) The China factory crackdown
When Delhi was being enveloped by a thick, debilitating blanket of smog just months back, the all-pervading pollution in China too made news in India. Of course, there is a tendency to compare any situation in India with that of China. But what hardly made headlines around the same time, at least in this country, was the unprecedented crackdown on pollution that China had already initiated. The reports trickled out of that country only in October when it was known that China was carrying out a blitzkrieg against tens of thousands of factories. The estimates varied, but at least 40 per cent of China's factories were shut down temporarily by safety inspectors, and officials from over 80,000 factories charged with criminal offences for breaching emissions limits over the previous year. The merciless crackdown coincided with the Communist Party congress announcing that the concentration of hazardous fine particulate matter (called PM2.5) would be brought down from 47 micrograms per cubic metre in 2016 to 35 micrograms by 2035. The designs had already been in place since 2013 when China had declared 10 measures to clean up the air, including reducing emissions from heavily polluting industries by 30 per cent by the end of 2017. The health benefits that would accrue because of the crackdown would be obvious to anyone. At the same time, a potential decline in China's industrial sector and GDP growth would be as obvious. Factories will have to comply and find ways to both meet production goals and environmental laws, and the ones that have been shut down (including an unspecified number of textile-dyeing-apparel units) will have a bearing on the global textiles supply chain. It has been barely two months since the crackdown ended, and it would be a few months before the effects are felt. There are two opportunities here: first, rival countries can make the best of the elimination (albeit temporarily) of China's factories and make hay; second, other countries can carry out similar crackdowns, particularly because sooner or later every government would have to take tough decisions on this count.
3) The sourcing of labour
The two western buyers platforms working to improve workplace safety in the Bangladesh readymade garment sector the Accord on Fire and Building Safety (otherwise called Accord) and Alliance for Bangladesh Worker Safety (Alliance) are still carrying on with their work, with the Bangladesh government agreeing that the Accord will continue to operate beyond the earlier May 2018 pull-out date until a set of rigorous readiness conditions are met by local regulatory bodies. The Accord is a consortium of European brands and buyers, and the Alliance for Bangladesh Worker Safety is a platform of North American brands and buyers. A Remediation Coordination Cell (RCC) would be set up under the country's ministry of labour and employment to monitor workplace safety in the RMG sector, it was announced in October. But, a climate of uncertainty prevails. The Alliance severed ties with 162 RMG units, and the Accord with 76. So, RMG factories that did not meet the criteria on workplace safety are already seeing a decline in the number of work orders from foreign buyers.
This would leave the distressing issues that had led to the formation of the Accord and the Alliance in the hands of the Bangladesh government. The last inspection had placed the number of garment factories deemed to be risky at 2 per cent; most of these had already been shuttered. However, the September fire at a textile mill in Munshiganj which resulted in the death of six workers are indicative of the contention that all is still not well. The bar, however, has already been raised, and pressure will be on the country's industry and its associations to ensure that tragedy is not repeated. Bangladesh remains a cheap sourcing destination for North American and European apparel brands; it would be interesting to track how they tread that thin line between input costs and incessant pressure from an ever-increasing constituency of buyers seeking ethical fashion. It would not be easy: labour rates in sourcing countries are going up one by one. In 2017, Vietnam approved a minimum wage increase for 2018, while that in Cambodia was slated to be increased to $170 from January 1, 2018. Factory workers in Myanmar a new favourite of apparel brands are seeking a 50 per cent hike in wages, even as El Salvador has approved the highest ever minimum wage increase. The wage increases in China had long seen brands opting for other cheap sourcing hubs. But, the writing is already on the wall: brace up for higher input costs, and therefore higher price tags too.
4) The US trade-off
A little more than a year back, the very prospects of Donald Trump being elected president of the United States had resulted in doubts being raised over the future of both the Trans-Pacific Partnership (TPP) as well as the Paris Agreement. The decision to withdraw from the TPP negotiations was announced immediately, and the announcement to renege on the Paris accord came later. Both were to have wide ramifications, and were along expected lines too. But the reaction to the two withdrawals, as many international and American developments later in the year have shown, is only leading to the isolation of the US. The erstwhile partners of the US in the TPP negotiations are now willing to go ahead with the deal, while on the Paris front the US remains the only country to stay out of the global quest to mitigate climate change. The TPP has already been renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) to reflect the new consensus, and commitments to liberalise in textiles, technical barriers to trade, sanitary and phytosanitary measures, competition, state-owned enterprises, labour and dispute settlements remain as before. As many as twenty provisions that had been inserted at the insistence of former US president Barrack Obama have been dropped too. Without the US, which accounted for 60 per cent of the combined GDP of the negotiating countries, the new TPP would lack both the lustre and the lucre; but yet, the 11 remaining countries would benefit more from the new partnership rather than stay out of it. The CPTPP may well become a reality, but it would be just another trade bloc without the US, and hardly in a position to turn the global trade scenario on its head. In other words, the pre-TPP uncertainty would prevail for some time, and India has a better textiles-apparel future if it makes up for lost ground on other trade fronts.
5) Clothing fibres in oceans
The harmful effects of the fashion industry on the environment had been known for a while, but the summer of 2017 saw the publication of a number of reports that sent shockwaves across the world. So far, most of the documentation related to pollution and degradation of the environment had either looked at discharge of effluents into water systems like rivers and wetlands or the dumping of toxic waste into landfills. What makes up two-thirds of the planet the oceans, the very source of life on earth had not caught attention for a number of reasons. In May, Dr Mark Browne, an ecologist at the University of New South Wales, warned of the impact of microfibres tiny particles measuring less than 1 mm in size that are present virtually in all ocean organisms and go all the way up the food chain into the bodies of human beings. Most of these appeared to come from acrylic, nylon and polyester fibres all manmade fibre favourites of the global textiles and apparel industry. Major apparel brands contacted by Brown acknowledged microfibres to be a big issue, but did not have a blueprint for change. The very next month came some vindication for Browne, who in 2011 had found that microfibres made up 85 per cent of human-made debris on shorelines around the world. Researchers at the University of California at Santa Barbara announced in June that, on average, synthetic fleece jackets released 1.7 grams of microfibres with each wash. Older jackets shed almost twice as many fibres as new ones, according to the findings of the study funded by outdoor clothing manufacturer Patagonia. Researchers at the University of Leeds and in a laundry lab in Plymouth found that polyester and acrylic clothing shed thousands of plastic fibres each time it was washed, sending another source of plastic pollution down the drain and, eventually, into the ocean. It was found that an average UK washing load of 6kg of fabric could release 140,000 fibres from polyester-cotton blend, nearly half a million fibres from polyester, and more than 700,000 fibres from acrylic. Another study by the Marine Pollution Bulletin in the US found that New York's Hudson river could be contributing 300 million microfibres into the Atlantic Ocean every day. If brands thought that they were just beginning to turn sustainable, they would have been mistaken, phenomenally so. The lifecycle of a garment now needs to be re-thought all over again.
6) The laws of the land
The bigger the $3 trillion global fashion industry grows, given the scale of its worldwide operations and the spread of its influence, the more it is under the scanner of activists, researchers and now scientists too. But this is not just about mounting stakeholder pressure; it is as much about a socially-conscious world. In terms of sheer numbers this world that one speaks of may not be huge in size, but it affects the entire industry: from demands being translated into laws to the erection of trade barriers for failing to comply with environmental and social standards.
Legally-binding reporting requirements are fast becoming the norm. The Directive 2014/95/EU of the European Union (also known as the Non-Financial Reporting Directive) mandates disclosure of non-financial and diversity information. It requires disclosure on topics of environmental protection, social responsibility and treatment of employees, respect for human rights, anticorruption and bribery, and diversity on company boards (in terms of age, gender, educational and professional background), and recommends that businesses rely on the UN Global Compact or the OECD Guidelines as a point of reference. France's new Corporate Duty of Vigilance law is stringent. Enacted in 2017, it asks businesses with over 5,000 employees in France (or 10,000 globally) to draft vigilance plans and take steps to prevent adverse human rights and environmental impacts arising from the activity of their own company and companies that they control. This leads to measurables, as the 2017 Corporate Human Rights Benchmark sought to do. Launched in 2013 as a multi-stakeholder initiative that drew benchmarking expertise from seven organisations, the 2017 edition evaluated 30 apparel companies from a pool of 100, with the average score being a dismal 27.3. The industry still has a long way to go, and will be under constant pressure to clean up its act for a cleaner society, with more laws being expected to be drafted over the next few years.
7) Higg Index reduces fatigue
When the Higg Index was introduced in 2011, it was accepted as the right way to start tracking environmental and social sustainability across the value chain. After six years of trial and error, the Sustainable Apparel Coalition (SAC) has released an update: the Higg Facility Environmental Module (Higg FEM, for short). This would be a self-assessment tool that seeks to standardise sustainability measurements for apparel, footwear, and textile mills. The Higg FEM would allow garment factories of any size worldwide to assess their overall sustainability performance, and share results seamlessly with their supply chain partners. The update had been coming, especially for cutting down on the audit fatigue that many had been complaining about. The announcement was clear: Currently used by more than 8,000 businesses globally, the updated version helps further reduce audit fatigue and improve performance benchmarking by measuring water use, waste, emissions, and assessing chemicals management with increased analytics. The robust tool allows business partners to collaborate more successfully to drive performance improvement across the value chain. The SAC, an industry-wide group of more than 200 leading apparel, footwear, and textile, brands, retailers, suppliers, service providers, trade associations, nonprofits/NGOs, and academic institutions working to reduce the environmental and social impacts of products around the world, believes global use of Higg FEM can transform the apparel industry into a responsible and sustainable one. The global supply chain is made of innumerable links, and now through its campaign called Link by Link, the coalition is urging its members to deploy the tool globally at an industrial scale, targeting 20,000 facilities and 400 brands to be online with the new version of Higg FEM by the end of 2018. The move to cut down on the audit fatigue factor would be welcomed by many, but the path towards the goal of the full Higg Transparency by 2020 still seems distant. The names on the member list of the coalition may be big, but those still represent a tiny plot of the vast fashion landscape. Unless the coalition itself grows never mind its reach or influence, its efforts cannot change the world.
8) Looking for that alternative
If the flurry of activities in technology can have a match in its feverishness as well as dedication, it can be found only in the quest for that elusive alternative fibre. That alternative fibre can be an answer only to cotton, and the search for it is reckoned to be as old as modern history itself. A number of alternatives have either been discovered in the natural world, or extracted from other sources; but none of them have been perfect. The closest that anything came to cotton were the slew of manmade fibres (MMF). For roughly four decades apparel made from MMF have ruled, and even gone to the extent of upstaging cotton as the dominant fibre of the fashion world. Not only were MMF garments considerably cheaper, the raw material did not need to be grown either in a world where arable land is becoming more scarce than before. Today, however, the preference of MMF is on a decline, though it is not precipitous yet. This decline can be attributed to two factors: first, the growing fad for products that are organic, or at least cotton-based; second, the piling evidence of pollution of the oceans caused by microfibres that come from garments. The first, as of now, is confined mostly to Western countries and that too among a relatively small consumer base that is aware of environmental issues. It is hardly a base big enough to turn the tables on MMF. The second, however, has little to do with a consumer base per se (even though it would be a contributing factor to the first). Big brands and retailers are sooner or later expected to start looking on oceanic pollution, and cut down on fibres that trickle into the oceans. This is where that perennial quest for an alternative fibre acquires a new dimension and intensity; it is now a race against time. Over the last few years, especially in this millennium, a lot of money has been poured into research for new fibres, yarns and fabrics. There have been innumerable discoveries and innovations, but none that promises to change the world. Most of these new-fangled discoveries and innovations have not even made out of the university laboratories. The search, therefore, carries on.
9) The GST dust to settle down
The rolling out of the goods and services tax (GST) eventually turned out to be far more complicated than many would have expected or wanted it to be. The shift from a fragmented and in many ways contradictory tax regime to another that was seen by many as inconsistent as well as way too complicated both in terms of compliance and contradictions as the earlier system had been, was met with widespread protests in textile-apparel hubs across the country. Much of the mandatory filings remain even after the GST Council kept meeting and sorting out issues with different industry sectors, including textiles and apparel.
Many of the higher tax slabs, that had been a bone of contention particularly in this industry, have either been relegated to lower ones, or done away with altogether. For the textiles-apparel-fashion industry, which is known for its long-winding value chain, there were as many demands and complaints as there were stakeholders. But the slowdown of trade and manufacturing among medium, small and micro enterprises that form the backbone of the industry hurt them more than it did big manufacturers, brands and retailers. With the Union government and the council sorting out many of the issues at hand, especially the anomalies in the tax slabs and goods/service categories, the heat generated in the months of July-September cooled down considerably towards the end of the year. It is not that every thorny issue has been solved, and it is also not that every segment of the textiles-apparel-fashion industry is happy with the state of affairs. The fragmented nature of the industry had not helped matters in terms of taking up issues either with the finance ministry or the GST Council. Till industry speaks in one voice and simplifies issues for the authorities concerned, it would be difficult for the government as well to understand the intricacies and compulsions of the value chain. As of now, the financial state of the industry cannot be ascertained for sure till the end of the current financial year.
10) The big event
The size of the Indian textiles and apparel industry is as well known as it is humongous. From the industry contributing a tenth of the country's manufacturing output to chipping in with 13 per cent of its export earnings, and from India being the largest producer of cotton in the world to the industry employing as many as 45 million people directly, every element has been well documented. Yet, when it came to showcasing all this to the world that too under one roof, India had not made any headway till last year. All that would happen all these years as intermittently as sporadically would be the innumerable textile fairs across the country, or the propping up of textile vignettes as cultural snippets at the India exhibitions in select foreign capital cities, not to speak of the fashion weeks that have mushroomed all over. None of those, unfortunately, could ever paint the big picture. So, when the ministry of textiles organised the Textiles India 2017 event at Gandhinagar in Gujarat, it could only have been that much-needed start. It was the first time that all sectors of the industry were brought under one platform, and from cotton production to brands and from exporters to handloom artisans, every sector was showcased to the world. Industry experts had always felt that the spread of the industry was too widespread and scattered, and that there was a dire need to put all the segments and sectors together as one composite industry. On this count, Textiles India 2017 was a phenomenal success. With a number of states reportedly falling over one another in the rush to organise the next edition, it might be an event to look forward to.