NEW DELHI: The government’s doubling of import duty on textile products will have a marginal impact on global apparel brands as several of them have localised manufacturing.
Earlier this month, the government had raised import duty on a gamut of textile products to protect domestic manufacturers and support the ‘Make-in-India’ initiative. Local manufacturing is expected to boost the demand for raw materials, including cotton, and provide a fillip to the employment sector.
“Three years ago, around 50% of our goods were sourced locally,” said Abhishek Ganguly, MD of Puma India. “We have ramped it up to 70% and are aiming for more. It’s easier to make cotton garments in India currently compared to technical clothing. In some such cases, we import the fabric and get the apparel made here.”
Certain types of technical fabrics that are used in making sportswear are still being imported. Ganguly said Puma has been approached by several local manufacturers, including Arvind and Gokaldas. “They have shown an interest in developing high-end fabrics and garments that are used in sportswear but the talks are in a nascent stage,” Ganguly added.
Textile giant Arvind, too, is accelerating its efforts to localise end-to-end manufacturing of garments for global fashion brands. “More than 80% of products of the brands that we sell here are Made-in-India, so the impact of import duty hike is going to be marginal except for some areas,” said executive director of Arvind, Kulin Lalbhai. Arvind is a supplier to companies such as Zara, H&M and Marks & Spencer.
In addition, the Ahmedabad-headquartered company plans to open plants in Gujarat, Jharkand and Andhra Pradesh in a bid to bolster its verticalisation plans and decentralise manufacturing. “China is becoming expensive in terms of labour cost. India is going to be strategic for garment manufacturing in the near future,” Lalbhai added.
Source: The Times Of India, India Friday, 17 August 2018