IMPRESSIONS from a Cross-section

Topic

India has always remained heavily dependent on China for import of raw materials. With change in political equation between the two countries and rising anti-Chinese sentiments, what does the country require to do to become self- dependent?

Money never disappears-it just finds new opportunities
With ongoing trade conflicts and political tension among different countries and blocs, the pandemic has only worsened things. Various stakeholders from the textile industry discuss how the industry can survive the onslaught of the pandemic and the situations arising from the same.


Political tensions that may impact India have taken a new level this year; whereas the country may have hoped that anti-Chinese sentiments benefit the country in the short term, China has shown an impressive recovery ability which will still attract buyers as business partners are looking for stability and security. However, India has the ability to step up, modernise its industry, invest in technology, build its autonomy in terms of trims and accessories, and capitalise on its reputation of sustainable sourcing to strengthen its attractivity. We have seen recent investments in virtual shows and suppliers' willingness to adapt their marketing to the new normal are very encouraging. There is so much to do when the industry is coming together.

Retailers have scrambled to make changes to their sourcing strategy, diversifying to other manufacturing hubs like Bangladesh, Vietnam and India. The gain for India cannot fully be reaped as there are challenges in the raw material supply chain that is still dependent on China. The fear of a government ban on imports from China keeps niggling. India needs swift action from the government, especially the ministry of textiles, to help provide increased incentives to exporters to stay long enough in the fight-if not to win-certainly to survive.

Indian mills and trim suppliers must innovate and work on product diversity that makes India self-sufficient. There are challenges of lead time, capacity, pricing and quality that need to be chipped away. For manufacturers, this is the time for consolidation and diversification as there is likely to be a dip in consumer demand-which can be as much as 30 per cent.

Indian exporters specifically have to follow the tow- the Atmanirbhar Bharat strategy-very seriously now and start indigenously producing the components/items that they were so far importing from overseas. India is a big market by itself and we have immense export potential, which should be seriously tapped now by our manufacturing/export community. The Indian government will do what it can, but now is the time for our entrepreneurs to become frontline champions to enhance India's manufacturing and exports. 

The imports of various accessories from China like laces, dyestuff and others have impacted the production lead times. The vendors do not have much say in the politics at local or international levels. They have to abide by the decision of the government in the larger interest of the nation.

The bureaucracy has to make sure that the export community is not adversely impacted by their reaction to ground situations. We see the 'work to rule' at various ports for import shipments leading to 100 per cent inspection of cargo resulting in a chain reaction, subsequently leading to delays in eventual exports. That leads to either air freighting the goods or cancellation as a worse-case scenario. Neither of them is good for the country. The export community is largely self-dependent and very swift and agile to realities.

I see more usage of better software to create new product ranges. India is anyway a hub for software development.

The contingency measures that the industry has to take is to develop local sources and align with the government policy of being "vocal for local." It should not be a mere slogan but be backed up by slew of measures like special incentives and single-window clearances for units to be set up for the China-substitute products-create the same kind of ecosystem as you will find in China. What is the downside here-quality and competitiveness. The industry has to be prepared for any eventuality and develop local sources at a higher cost price.

Money never disappears-it just finds new opportunities and I believe that both buyers and stakeholders in India are busy preparing themselves to make the best of the situation till the business that is now down finds its own level by 2022. Meanwhile, restrictions from and to China will result in another restructuring. Online business will become bigger and better. 

The future is already here and buying agents and raw material and accessory suppliers must use whatever resources they have to an optimal level. While new opportunities in businesses present themselves, as in masks and PPEs, we are stymied by the restrictions on these businesses to export. Appropriate government agencies must open up critical new opportunities.

This article was first published in the August 2020 edition of the print magazine.

Published on: 18/08/2020

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.

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