Chennai apparel export units struggle to survive

12 Jun '12

1 min read

Rising labour and power costs, along with stiff competition from Bangladesh, is forcing garment exporting units in the southIndian city of Chennai, famous for woven menswear including the Madras Checks, to struggle for their survival.

“Thirty three leading export-oriented units closed down recently in and around Chennai leading to job loss for approximately 45,000 people,” Mr. Ranjit P Shah, President of the Apparel and Handloom Exporters Association, told fibre2fashion.

“One reason for this is the intense competition from Bangladesh after the Indian Government allowed import of 46 apparel items duty-free into India. Bangladesh has low labour cost and high productivity advantages compared to Chennai,” says Mr. Shah.

“Local retail brands are also importing garments from Bangladesh as it is cheaper to source apparels from the neighbouring country. The cost of production in India is more due to high minimum wage and electricity problems, especially in south India,” he explains.

“To avoid full closure of apparel units in Chennai and surrounding areas, there is an urgent need to lobby with Government to save jobs,” avers Mr. Shah.

Fibre2fashion News Desk - India

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