Are we ready for the challenge?

This is the report on World Fashion Clothing Business from an Indian fashion business people perspective. Indian garment producers are acquiring the unique production status for the world wide fashion retailer brands and the designer brands. We follow the 5S policies and even the stringent European norms for environmental safety in fabric processing and are accredited by ECO certification and TÜV certifications. Moreover the export houses are acquiring the 5 star stamps from the Directorate General of Foreign Trade ( DGFT). We are becoming powerful in terms of exports year by year and the amount of foreign trade is at its peak of growth in a steady state.

But when the situation is brought under the ultra scanner for a macro economical research, it becomes evident that the situation is not progressing towards a sustainable growth. The producers are in a posture of adventurous walk on a circus rope who tries to maintain their balance and in a need of a major rescue from the trade policies inland. The entire production industry in the textile sector is surrounded by the leeches from the north east frontiers of the nation. I am talking about the Chinese and the Bangladesh markets. They are progressing in a pace right upwards steeply and steadily and they aren’t much worried about the drop of dollar rates in the International exchange.

When this competition is at its peak, the production industry in the nation is enforced to encounter a serious trouble in the major nation-wide. There are various barriers suppressing the growth of the entire textile sector in terms of ergonomics and economies of scale. The processing industry is forced to limit its capacity of production due to the environmental factors. On the other hand, the energy crisis munches the lead time of the entire industry’s productivity. When such industrial products are brought under the limelight of the concerned authorities, the trade factors leaps in front like a giant and it thwarts the industrial expansion ideas to the recycling bins. When the raw material costs increases at an angle of 45 degrees every week and the finished goods are liable to 30 % processing fee and taxes, the economists can even begin a research in the new trends in terms of Market Elasticity in the Apparel production industry. I’m sure he will be awarded the gold medal because it is such a poking factor which really threatening the entire textile production sector.

If this situation prevails, the small scale manufacturers will have to risk their investments and have to face the credit consequences. The entry to the new markets is also unfeasible since the whole industry is saturated with the acquainted market segment. It is highly impossible to enter the premium clothing business without any foreign direct investment in terms of provisions to expand the capacity and supply chain. It is a situation where we are unable to expand ourselves in terms of capacity and even it is unable to expand the market segment in a feasible way. We are walking on the iron bridge with the fire heating the bridge underneath.

Though the recommendations are ready to discuss with the authorities who may bring up a solution, the political climate is not encouraging at the moment and it is evident that our business men have to walk some more all the way along the red hot iron bridge. The question is why we did not foresee this situation a year ago. The policies on trade has to be made in such a way by measuring the longevity of the market and its saturation which makes the business to run but not the temporary solutions to run the businesses.