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Kutch-based NGO, Khamir is working with the National Institute of Design to experiment with Kala cotton. Kala is a coarse and short-staple strand of cotton grown in large parts of Gujarat.
It is tenacious and more responsive to dyes. However, it’s not easy to work with. From cultivation to creating yarns, it requires more effort compared to mainstream crops. While two groups — consisting of artisan and three students each — worked on cotton, two opted for sheep wool acquired from Kutch. The project was part of the coursework of the design program.
All the clothes were made completely on loom, without any waste, with natural dyes. Young artisans are being encouraged to get exposed to global trends and new ways of designing to reach out to a newer audience. The initiative at NID was thus strategic to providing them a new perspective.
Stakeholders have shown interest in taking the idea further. The indigenous cotton and wool, apart from being sustainable and providing livelihood to the traditional practitioners, are also better suited to the local climate. Indian textiles have thrived on indigenous varieties of cotton used by people in different parts of the country to suit their needs.
Although Vietnam is one of the five biggest apparel exporters in the world, there aren’t any known Vietnamese brands. The textile and garment sectors spearheads the country’s export and generates the biggest number of jobs -- about 2.5 million. However, most employees in the sector are manual workers in charge of simple steps while the steps requiring technical skills like dyeing or designing are facing a shortage.
Shortage of high-quality manpower is also one of the reasons why local production of apparel remains undeveloped and Vietnam has to depend on imported materials. Meanwhile, not much is being done about generating high value additions like designing products or on brand building.
Only about 30 per cent of the 6000 textile-garment businesses in Vietnam operate in textiles, including weaving, dyeing, printing and finishing fabrics. Most of the remaining firms make products ordered by foreign fashion brands. Only a few are able to create their own products, from manufacturing fabrics, designing, to making apparel.
Many companies still have to hire foreign experts and technicians at high costs to be responsible for dyeing, completing fabric and designing products, thus augmenting production costs and reducing their products’ competitiveness compared to foreign rivals.
Master will transfer its continuous dyeing technology with indigo and other dyestuffs of warp chains for denim fabrics to Karl Mayer. Karl Mayer will take over Master’s patents, trademarks, projects and dyeing technology for the IndigoFlow, IndigoRope and IndigoGenius models.
Master will stop manufacturing these machines and focus on developing and manufacturing new machines for packages and hank dyeing. Karl Mayer will further develop the nitrogen technology by integrating it into its current product range Prodye-S and Prodye-R.
The IndigoGenius today represents the most advanced machine in the world. This ingenious technology purely based on ecological and economical parameters, cuts by half the number of dyeing vats.
Karl Mayer is a market leader and a driving force in textile machinery building. It offers machine and appropriate solutions for warp knitting, technical textiles and warp preparation for weaving.
Master is a pioneer and leader in continuous dyeing with indigo and other dyestuffs. Master, based in Italy, it is known for its popular warp rope dyeing system for denim fabric. It is considered to be the most classic processing method, representing the most widely used one in the world. It has been used for over a hundred years and has never been subject to substantial technical changes, either technical or architectural.
Fast fashion is at risk of hitting a speed bump if a looming crisis sweeps Bangladesh’s banking sector. Financial institutions in the South East Asian nation face a credit crunch following mass deposit withdrawals in March and soaring levels of non-performing loans.
A full-blown crisis could spill over into Bangladesh’s strongest link to the global economy — the production of textiles and garments for fast fashion brands and retailers such as H&M, American Eagle Outfitters, Zara, Walmart and Target. A banking crisis would have a knock-on effect on global garment supply chain.
Garment factories’ inability to secure loans due to a banking crisis could possibly hold up the supply chain of global clothing retailers. Bangladesh is the largest exporter of readymade garments after China. Knitwear and woven garment exports between July and January accounted for about 83 per cent of its exports.
Loans from commercial banks remain a key source of working capital for many of the thousands of factories in Bangladesh. Years of corruption and poor lending practices have sent levels of bad debt at some banks above 20 per cent, while capital buffers are dangerously low. Irregularities uncovered at two large commercial lenders have sparked a broad run on national savings certificates, a retail savings product, further hurting banks’ balance sheets.
India is attracting Vietnamese investments particularly in garments and textiles. India allows 100 per cent FDI in single-brand retail via the automatic route, which means foreign investors can pour money into the market without prior permission. Vietnamese garment companies can take advantage of the policy by investing in production of threads, fabrics and ready-made clothes. The Indian market of 1.3 billion people is a tempting opportunity for investors.
Currently Vietnam and India are among the five leading garment exporters in the world. Last year, the value of Indian apparel exports to Vietnam grew 44 per cent while Vietnam’s shipment of garment and textile products to India grew by 42 per cent.
Improving trade transactions and connectivity has been classified as a strategic target by the two countries. They aim at bringing bilateral trade to $15 billion by 2020. Last year, Vietnam’s textile and garment exports were up 10.23 per cent from the same period last year while its imports of textile and garment materials, mostly yarns and fabrics, amounted to $19 billion. Between April 2017 and January 2018, Vietnam-India trade reached $10.39 billion, surpassing the $10.13 billion figure recorded from April 2016 to March 2017.
The US is reviewing the generalized system of preferences (GSP) through which Indian exporters get preferential market access to the US. This means Indian exports could be hit. The US has been accusing India of unfair trade practices and has challenged most of its export subsidies at the World Trade Organization. Moreover, it has not granted India an exemption on an unilateral hike in steel and aluminium tariffs, unlike its other strategic allies.
The GSP program allows duty-free entry of 3,500 products from India, which benefits exporters of textiles, engineering, gems and jewelry and chemical products. Of the total US imports under GSP in 2017 India was the biggest beneficiary followed by Thailand and Brazil.
For India, GSP eligibility review is based on concerns by the US dairy industry and the medical device industry alleging Indian trade barriers affecting US exports in those sectors. India has very high import duties on dairy products to protect its domestic industry. It has also recently put price controls on medical devices like cardiovascular stents, drawing the ire from big US pharma companies.
Though India is worried about the move, it hopes a majority of US industries which get cheaper intermediate products from India due to GSP benefits will support continuation of the program.
Home Expo is on in New Delhi from April 16 to 18. It aims at be a benchmark event for premium merchandise. A wide range of tableware, home textiles, kitchen ware, house ware and bathroom accessories is being displayed. International buyers, leading manufacturers and exporters will share the same platform and exchange ideas related to the industry. The event will showcase finest artistic elements and craftsmanship in harmony with innovative designs and latest products.
More than 650 Indian exporters are displaying exquisite house ware, decorative, furnishing, flooring and textiles and furniture and furniture accessories. The major markets for home furnishings, floorings, home textiles, furniture and accessories, house ware and decoratives are the US, Canada, France, Italy, UK, Netherlands, UAE, Japan and Switzerland.
Home Expo India 2018 is expected to generate good business for direct imports. It is being organized by the Export Promotion Council for Handicrafts (EPCH). EPCH is the nodal export promotion body for handicrafts in India and plays an important role of a catalyst between exporters, buyers and the government with the main objective of boosting trade in handicrafts and also projecting India’s image in the global market as a reliable supplier.
Prices for Australian wool have been at a record high. Australian wool prices increased by almost 30 per cent compared to last year. Its being driven by China’s unstoppable appetite for Merino wool. China’s wool imports increased 4.5 per cent from the previous year.
Domestic consumption of woolen products in China has grown dramatically in the last five years. Previously most processing was for export, while today at least 50 per cent is for domestic use, and this is growing year on year. Consumers in China were previously driven by price. But today quality and color come first. This is mainly because the average Chinese consumers have higher disposable income. Unemployment is low, salaries are rising, and pension schemes have given people a greater security of income and more money to spend.
Although wool only represents 15 per cent of fibers consumed in China, volumes are so large that even 15 per cent represents a huge quantity of wool. Even in Mongolia, women wear woolen coats. Apart from China, steady demand from buyers in Europe and India will see wool prices firm up for some time.
Bangladesh garment manufacturers and exporters are exploring the Japanese knitwear market. Among Japan’s knitwear imports, Bangladesh has only a three per cent market share. Vietnamese apparels have grabbed the largest share of Japanese market.
With Japanese concerns about product quality, and their heavy dependence on China, Japan’s market was not open to Bangladesh for a long time. Now, China’s shift to a capital-intensive industry and Japan’s China-plus policy has created immense export opportunities for Bangladesh and it hopes to be a top knitwear supplier to Japan. The knits sector is growing in Bangladesh with strong backward linkages. The country hopes to increase its exports by 25 per cent by 2020.
Huge orders are expected to come from Japan during the Summer Olympic Games, to be held from July 20 to August 9, 2020, for knitwear products like T-shirts, polo shirts and sweaters. And Bangladesh hopes to get a huge chunk of these orders.
Japanese investors are interested in an economic zone coming up in Bangladesh and a delegation will visit Bangladesh in November to explore investment potential in the country. Currently, the number of Japanese investors in Bangladesh is 350, of which many are big multinational companies.
"While textile is one of the most important sectors in Cambodia’s economy, pressures from neighbouring countries is adversely impacting growth. To add to it, increasing automation and loss of preferential trade agreements is aiding to its woes. Employing 86 per cent of all factory workers, about 40 per cent of Cambodia’s GDP comes from garment exports, while more than 800,000 people are employed in garment factories."
While textile is one of the most important sectors in Cambodia’s economy, pressures from neighbouring countries is adversely impacting growth. To add to it, increasing automation and loss of preferential trade agreements is aiding to its woes. Employing 86 per cent of all factory workers, about 40 per cent of Cambodia’s GDP comes from garment exports, while more than 800,000 people are employed in garment factories.
Rising wages a bane
Owing to its low-cost labour, Cambodia remains a favoured destination for global garment brands. But recent years have seen steep wage hikes for garment workers, and the trend has accelerated ahead of July’s national elections. Minimum wage increased from $61 in 2012 to $170 this year. And to lure garment workers ahead of elections, Prime Minister Hun Sen has announced many populist policies, including increased burden for businesses to pay into their workers’ funds at the National Social Security Fund. In a recent speech, he said experts say $250 per month is a reasonable minimum wage by 2023 or it could be even higher. This could prove catastrophic, say factory owners.
Eric Tavernier, CEO, France-based textile firm We Group, feels they cannot survive a 12 per cent wage increase every year. However, they don’t have immediate plans to leave the country. Indeed a significant number of factories feel the pressure and are considering moving out, not many are willing to come in. He feels, compared to Vietnam and China, the Cambodia has maintained its profitable edge only due to lower wages, as Cambodia’s transportation, freight and export costs were much higher than neighbouring countries. As competition is intense, they can’t pass on the price increase to consumers. While Vietnam has high wages but there’s better oversight, better shipping and more flexibility in the market. However, Heng Sour, Labour Ministry spokesman says increased costs and wage hikes have not deterred investment in the sector. The January elimination of export management fee, along with exemptions allowed to prepayment tax – a 1 per cent minimum tax obligation paid on monthly revenue flows – are expected to amount to a $40 million tax break for factories this year.
Anthony Galliano, CEO, Cambodian Investment Management says Cambodia needs to improve a wide range of factors if it hoped to keep investment flowing. Cambodia’s attractiveness and competitiveness has elevated over the last 10 years, primarily due to low labour costs. But infrastructure, productivity, energy costs and logistics must improve if it is to remain a major player.
Automation not easy choice
Stephen Higgins, Managing Partner, Mekong Strategic Partners feels if costs are going up faster than productivity, then Cambodia is at risk of losing factories to other countries in the region. Embracing automation is the only way they can improve productivity quickly to justify wage rises. David Tan, MD, MyTeb Cambodia, notes Cambodia lacks both trained workforce and infrastructure to support an automated factory. Electricity and uptime remain a critical challenge. Without steady and uninterrupted supply of energy, many of automated processes will be disrupted, causing multiple delays and unproductivity. On similar lines, Marco Kalinna, Founder, Cosmos Services says Cambodia can only be competitive in areas where labour costs are still an advantage. Mass-automation will find a place where electricity costs are affordable and there is proximity to markets, and Cambodia has none of these.
Preferential trade agreements
The EU imports more than 40 per cent of Cambodia’s garments, making EBA a cornerstone of the Kingdom’s economy. Kalinna says, removal of duty free (status) for garment exports to the EU would certainly have a shocking effect on the garments industry. If that happens, within 18 months, up to 50 per cent of manufacturers would move out of Cambodia. It still remains to be seen if the EU would enact such a measure. Higgins says there are more effective, targeted mechanisms for the EU to make their point than a broad brush approach like pulling the EBA.
The EU, prompted by protectionist concerns from member nations, launched an investigation into Cambodian rice exports last month – the first investigation of its kind of Cambodian exports. The decision was unrelated to labour rights or the political situation but the move indicates Europe won’t hesitate to re-evaluate Cambodia’s tariff-free status if it determines it would benefit its members’ interests. On rising concerns, Galliano points out while strong statements threatening concrete steps have been issued, withdrawal of preferences are rarely implemented.
