India’s clothing industry could loose Rs 1 lakh crore due to lockdown, says CMAI
India’s domestic apparel industry could loose around Rs 1 lakh crore ($13.54 billion) due to the ongoing lockdown mandated to stop the spread of coronavirus, according to the Clothing Manufacturers Association of India’s recent survey.
India’s clothing industry is in dire need of government support, according to the CMAI’s recent survey accessed by ET Bureau. Over 1,500 surveyed CMAI members said that they expect more than a 40% drop in demand after the lockdown ends resulting in losses of around Rs 1 lakh crore.
The drop in revenue for fashion brands could cause around 50 lakh job losses in the apparel industry, according to the CMAI survey. This would, in turn, effect other areas of the industry and could cause one crore job losses across both textiles and apparel businesses. Of the surveyed members, 80% said they need to immediately downsize to accommodate the halt to revenue and many surveyed businesses plan to reduce salaries of continuing employees.
The lack of working capital many textile and clothing businesses now face will mean that factories will be slow to re-start after the lockdown ends. Many apparel companies said they only expect business to begin to return to normal in the 2022 financial year.
The CMAI has asked Prime Minister Narendra Modi and the Ministries of Textiles and Finance to provide further aid to the apparel manufacturing industry during the current crisis.
The government has announced several measures for the industry and Textiles Minister Smriti Irani urged global buyers not to cancel apparel orders from India.
However, the CMAI has highlighted the need for support for micro, small, and medium enterprises, which make up the majority of all textile and clothing businesses.
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