News / Apparel buyers revive alternatives in India amid Bangladesh struggles

Credit: TIrupur Exporters Association

India’s textile/apparel export hub of Tirupur, near Chennai, in Tamil Nadu state, is bouncing back from the days of frequent production cuts and disruption caused by a dearth of orders. 

According to industry sources in Tirupur, a manufacturing belt also known as the ‘knitwear capital of India’, most ‘closed’ textile units in the region have reopened, with new orders arriving from global buyers increasingly searching for alternatives to Bangladesh suppliers struggling to keep their supply chains running. 

KM Subramanian, president of the Tirupur Exporters’ Association (TEA), told The Loadstar business prospects had significantly brightened after a couple of bad years, following the demand downturn from excess inventory stocks built by buyers or retailers in anticipation of prolonged disruption during Covid. 

“Tirupur production has now returned to an almost 90% level,” noted Mr Subramanian. “We are gearing up for the demand boom developing across the garment-making verticals.” 

The Tirupur cluster houses some 2,000 large factories and some 20,000 ancillary units, cumulatively employing about a million people. 

According to Mr Subramanian, exporting units have begun to field a flurry of enquiries from several big global brands, with order conversions expected for shipment early next year. Potential European buyers include Primark, Tesco, M&S, Next, George, Decathlon, Vamer and Duns, with Gap, Guess, Walmart, Costco and JCPenny leading the US interest bandwagon. 

“We are going through mandatory compliances and other buyer requirements to win orders,” Mr Subramaniam said, and he expects the Tirupur industry to end the fiscal year 2024-25 with a $5bn export turnover, following $3.9bn last year. 

Meanwhile, Indian RMG exports, by value, in November were up 10% year on year, according to new data released by the Apparel Export Promotion Council (AEPC). 

“The growth for the month reflects the growing trust of the global brands for made-in-India products,” said AEPC chairman Sudhir Sekhri. “The growth in the US and UK is picking up, which are our top markets.” 

Additionally, a resurgence in garment exports will significantly boost air freight demand out of India, according to industry observers – that view is a key factor driving massive airline fleet expansions in the country, with a 100-aurcraft order from Air India last week the latest investment. 

“We anticipate that fleet developments will bolster the efficiency of air cargo logistics, further fuelling economic growth,” Mahesh Fogla, executive director at Mumbai-based 3PL Patel Integrated Logistics, told The Loadstar. 

Meanwhile, Bangladesh’s apparel trade, its economic backbone, is crimped by supply chain challenges, political tension and ethnic clashes that have had a negative impact on ties with India, its closest ally under the previous Sheikh Hasina regime. 

To tide over the crisis, the Maldives has become an interim air freight transit alternative for RMG exports to third countries, sources noted. One told The Loadstar: “While there are still hurdles to pushing that rerouting to a scale, a moderate shift is taking hold.” 

Indian forwarders with interests in apparel, however, believe it’s hard for Bangladesh shippers to replace the Indian transhipment options with the Maldives, as air connectivity out of Dhaka is not in favour of the latter.   

Additionally, two-way fill factors are typically taken into account for freighters considering Maldive connections, being a small market thriving on tourism alone. 

And, according to them, Bangladesh cross-border cargo continues to flow through Indian airports, particularly Delhi’s air cargo complex. 

Also, Customs at Nhava Sheva recently updated an order allowing Bangladesh transhipment cargo, indicating India’s willingness to keep regional trade interests going, despite geopolitical strains and its opportunistic RMG trade gains out of the trade disruption in its neighbour.