The crisis in Bangladesh has taken a toll on its textile sector, a major contributor to the country’s export revenue. With international buyers looking for alternative markets like India, the Indian textile industry stands to gain significantly from this shift. Industry experts predict that India could see an additional business of $300-400 million per month if a portion of Bangladesh’s export is diverted to Indian hubs like Tiruppur.
K M Subramanian, president of the Tiruppur Exporters‘ Association, anticipates a surge in orders coming to Tiruppur, with expectations of at least a 10% increase compared to the previous year. This boost in business could help offset the losses faced by Bangladesh, whose monthly apparel export ranges from $3.5-3.8 billion. With a high market share in the European Union, the United Kingdom, and the United States, Bangladesh’s textile industry plays a significant role in the global market.
India, on the other hand, currently exports in the range of $1.3-1.5 billion per month. Prabhu Damodaran, secretary to the Indian Texpreneurs Federation, believes that India has the capacity to handle the additional orders that may come its way due to the crisis in Bangladesh. This sudden shift in demand could lead to a rise in Indian exports and potentially boost the country’s textile industry.
The crisis in Bangladesh comes at a time when the country was on track to surpass $50 billion in annual export in 2024. However, with the turmoil affecting the supply chain and causing disruptions in the manufacturing sector, Indian-owned units in Bangladesh are also considering shifting their base to India. Trade-policy analyst S Chandrasekaran estimates that around 25% of the manufacturing units in Bangladesh are owned by Indians, including prominent companies like Shahi Exports, House of Pearl Fashions, and Jay Jay Mills.
The breakdown in the supply chain for the upcoming Christmas season has further exacerbated the situation, leading to a potential increase in orders being diverted to India. This unexpected turn of events could provide a silver lining for the Indian textile industry, compensating for the drop in global volumes with a rise in Indian exports.
In conclusion, the crisis in Bangladesh has created a ripple effect in the global textile market, with India emerging as a potential beneficiary of the turmoil. As international buyers seek alternative sourcing destinations, India’s textile industry is poised to capitalize on this opportunity and potentially expand its market share in the coming months.