Recently Russia-Ukraine war-affected Indian garments. Due to the uncertainty in the region about the fallout of the Russia-Ukraine war, European apparel brands have slashed garment offtake from Tirupur and Noida by up to 25 percent.
As all the big global brands have closed shutters in Russia, the order flow from Europe has subsided.
If this trend continues then in FY23 exports may come down by 20%-25%. The garment hub annually exports Rs 35,000 crore worth of goods.
Raja Shanmugam, President, Tirupur Exporters Association (TEA) said, “It is not that the European buyers are not placing orders. But the volumes have come down. Also, yarn prices have gone up by 110 per cent since 2020. The buyers have already absorbed the increase in prices by two to three times.”
Meanwhile, high yarn price is posing a problem to the garment manufacturing units in Tirupur.
Most of them are MSMEs. Since the yarn prices have gone up, delivering goods on time is becoming difficult. But the foreign buyers rely on India because of the stability in country.
According to Lalit Thukral, president, Noida Apparel Export Cluster, the units at Noida have seen a 15 percent drop in orders from Europe.
For instance, earlier if a buyer was purchasing 150,000 pieces, he is now buying 1,00,000 pieces,” added Thukral.
Spanish fashion retailer Inditex that owns the Zara brand has halted trading in Russia, closing its 502 shops and stopping online sales a fortnight ago.
Also, H&M has suspended operations in Russia following the invasion of Ukraine and imposition of sanctions.
Spain’s second-largest largest fashion retailer Mango has also announced temporarily closing its 120 Russian shops.