Caught in a Warp ; Empty Order Books, Layoffs and Slow Growth in the Textiles Sector Call for Immediate Policy Intervention.

Summary

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It's yet another quiet September at Hari Kapoor's Allied Export Industries, a garment manufacturing and export company in Noida specialising in fashionable women's clothing. Till about two years back, Kapoor would be rushing at this peak time of the year to grab the most lucrative orders and fill up the order books for deliveries up to February.

All that has changed in the last one year of the economic meltdown. Overseas sales account for about 40 per cent of the $52- billion textile industry. Orders have dried up for Kapoor's merchandise in the recession-hit markets of the West. His factory's output is down by 10-12 per cent from the 4,00,000 pieces he made every month. Worse, he has had to close a unit and cut 20 per cent of his 4,000-strong workforce.

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Extract

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Caught in a Warp ; Empty Order Books, Layoffs and Slow Growth in the Textiles Sector Call for Immediate Policy Intervention.

Like Kapoor, thousands of textile manufacturers and exporters are facing the heat of the global downturn. Bankrupt companies in the US and Europe, like Pacific Sunwear and Steve and Barry's, have cancelled bulk orders leading to a drastic fall in Indian exports, slowdown in the growth of the sector and massive layoffs.

According to the Commerce Ministry, India's textile and clothing exports to the US have declined by over 14 per cent at $1.7 billion in th...

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