test


Member ID:
Password: 
Stay logged in for 30 days
Forget Your Password?
close

login CCFGroup App

Industry News | Time: May 27 2020 10:34AM
Industry could achieve pre-Covid business levels by 2021 textile excellence survey
 
Text size

The world is waiting to go back to the comfortable normal that it was used to. While that may take some time, lockdown restrictions the world over are easing. In India, a number of industrial units including textile and apparel factories have resumed operations. Of course, there are some issues – worker availability, strict adherence to hygiene and social distancing guidelines, financial stability, and more.

A recent survey by Textile Excellence is aimed at understanding how the industry plans to sail through the current crises, and how the situation could unfurl going forward.

Some key findings

Production


97% of the respondents said that production has been impacted anywhere between 50-100%. This was a given due to the lockdown imposed across the country. While partial production has begun in some textile and related mills, the industry believes it will have to wait for a few months to achieve full production.

36% of respondents feel they would achieve full production by July, 23% by September, 20% by next month, 12% by November. About 5% of the respondents feel they may get to full production by June.

For the full financial year 2020-21, 43% of the respondents said that 30% of their production will be impacted, while 39% said that 50% of their total production will be impacted. Another 7% said that 10% of their production will be impacted. While 5% said that production will be hampered by 70%.

Job losses

The economy could be looking at significant job losses in the textile industry in the near future.

27% of the respondents expect 35% job losses in the textile industry.
12% respondents expect job losses of 20% and a similar number of respondents expect a 50% job loss.

9% of respondents have said there will be no job losses in their organisations, and the company will look at other ways to cut costs including a cut in salaries and wages.

Economic recovery

100% of the respondents expect severe recessionary impact of Covid-19 to be felt throughout 2020.
37% respondents expect the economy to recover within 6-12 months.
80% respondents expect economy to take 1 year to show signs of recovery.
07% respondents expect recovery to take 1-2 years.
93% respondents expect economic recovery to take 2 years.
65% respondents expect recovery to take 3 years.
However, the global economy would take longer to recover, the industry believes.

Strategies to tide over the crises

Respondents chose a mix of strategies to overcome the current crisis, and emerge strong going forward.

Cost cutting was the most important strategy, with 29.45% of respondents choosing this, alongwith other measures such as product development and innovation (21.70%), improving efficiency (13.17%), increased emphasis on marketing and sales both in domestic and export markets (13.17%), fund management (9.30%) and cutting production (6.97%).

Around 24.80% of respondents prefer to wait and watch how the scenario emerges before deciding on a strategy.

Surprisingly, skilling workforce is an option chosen by just 1.55% of the respondents.
10% of the respondents believe that e-commerce and other online platforms will be part of their strategy.

Stimulus package an absolute necessity

A meaningful stimulus package is sought for the medium to long term.

13% of the respondents said there was no government stimulus package announced for the textile industry, and the MSME sector.
32% of the respondents said that there was much more needed than what was announced.
In keeping with the demands from the various textile industry associations, respondents too believed that there was urgent need for a stimulus package that would include among others:
Restructuring of loan repayment
Working capital loans at nominal rates of interest
Interest subvention
Package to boost textile & apparel exports
Curb textile and apparel imports
Specific package for MSMEs
Current benefits should be extended for at least six months to a year, depending on how the economy moves forward
More meaningful PF and ESIC relaxations
Compensation for salaries and wages
Restart economic activities as soon as possible in coordination with state governments
Refund GST claims & TUFS subsidy without delay
Compensation in utility bills
Defer payments such as GST, etc.

India’s textile and apparel exports

Even if a stimulus package is in place, it will be some time before we see India’s textile and clothing exports at pre-Covid-19 levels.

The survey showed that 34% of the respondents believe exports will reach pre-Covid-19 levels by the end of 2020.

However, 66% believe that will not happen in 2020.

India’s main markets – US and EU – could be in a deeper economic recession than India, and India’s textile and clothing exports will recover once these economies start to fare well. And that could be well into 2021, at the earliest.




Source: TextileExcellence
[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
Related Articles
Operating rate of printing and dyeing mills inched down in July
Turkish apparel markets positive about revival with demand picking
Indian textile industry will be hit: 97% Bangladeshi products to
Sales situation of textile machinery in Q1 2020
Large-scale knitting and dyeing mills lack of production workers
Jun operating rate of printing and dyeing plants increases
Bangladesh ready-made garments continue to show a significant fall
Indonesia applies safeguard measures for imported fabrics
Vietnam greenlights EU trade pact in bid for China-exit
H&M's sales tumble, stockpiles grow in March to May
 
Research
PET bottle chip market to face challenges after an ...
Spandex market review in H1 2020 and market outlook
PTA and PX market outlook in H2 2020
Analysis on production changes of global major cotton ...
Analysis on spandex for ear bands for masks in 2020
Analysis on spandex industry supply and demand
 
 

浙公网安备33010902000742号