“Apparel sector should increase exports to India”
SLASA Secretary General Gopal K Iyer (far right) with panelists
To overcome the current dip in exports, the apparel sector should look at increasing exports to India opined Apparel Buyers’ Association (SLASA) Ex-Co Member Padmal Silva at panel discussion in Colombo.
Silva explained that India’s domestic market in 2022 was USD 100 billion and that by 2028 will increase to USD 175 billion.
“Being the fastest growing economy in the world and one which we supply to, India has been pragmatic, studying global markets and leading the trend. US brands are in India now because they see potential. As and when premiumizing happens and the massive middle-class population increases, disposable income will in turn, go up.What Sri Lanka hasn’t explored is how we leverage on those synergies and collaborations India has already forged.”
Though the Sri Lankan apparel industry’s export figures were phenomenally good in 2022 despite the fallout from the pandemic and the economic crisis, a total of USD 5.5 billion, the highest increase of 10% since the crisis, the industry’s performance hit a low from the beginning of 2023.
Secretary of SLASA, Gayan Galapitage said, “Global inflation, softening retail markets, the Russia-Ukraine war and uncertainty in financial markets all helmed the challenges that led to Sri Lanka’s apparel exports reducing 16.5% in the first five months of 2023 with the primary markets of US, EU and UK all facing unprecedented challenges. US orders regressed by a significant 22%, the UK by 15% and the EU by 14%.”
Chairman of SLASA Wilhelm Elias, said Sri Lanka imports about 705 of the fabric requirement which translates to high fabric prices and there are still only four jersey mills in the country. “We have to push boundaries, invest in R&D and strive for excellence.”
Observing the reasons for the downturn in fortune for apparel industry, Elias opined five primary reasons. “Customers being overstocked post-Covid as a result of buying in advance due to extended lead times, inflation in the UK and the EU reaching unprecedented levels, the Sterling Pound losing ground to the US dollar which resulted in 11.5% decline in buyer budgets, Sri Lanka’s destabilization in May 2022 seeing customers shift to Bangladesh and India and both these countries pushing costs down significantly to keep factories operational, which Sri Lanka found difficult to compete with.”
Vice Chairman SLASA, Azmeena Kareem said customers having lesser disposable income are a fact that won’t change anytime soon. “Countries like Bangladesh and India read the signs and reacted to these faster than Sri Lanka did. Sri Lanka overstocked in the US and was not proactive enough to understand the market changes at the time. Sri Lanka has become complacent with what the country enjoyed before and was not open to change,” SLASA Member Sandun Silva said.
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