ITMF Survey Indicates Optimism for H1 2024
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- Published: Thursday, 18 January 2024 07:37
The global textile industry, grappling with a slowdown since the second half of 2022, is looking towards a more optimistic horizon in the first half of 2024, according to a recent survey conducted by the International Textile Manufacturers Federation (ITMF). The survey, undertaken in November 2023 and encompassing stakeholders across the textile value chain, revealed that 44% of participants anticipate a favorable change in business situations in the initial six months of the upcoming year.
Dr. KV Srinivasan, the newly elected president of ITMF, expressed the industry's challenges, citing factors such as weakening demand, inflation, geopolitical issues, volatility in raw material prices, surging energy costs, labor shortages, and rising interest rates. The survey emphasized that a significant portion of respondents (76%) identified weakening demand as the primary cause behind the industry's recent lackluster performance.
The global textile sector has encountered unprecedented challenges since the latter part of 2022, following a post-COVID-19 lockdown surge in demand. High-cost inventory, geopolitical tensions like the prolonged Ukraine-Russia war, and supply chain disruptions due to the pandemic-induced lockdowns have contributed to the prolonged slowdown. Retailers in major export markets, including the US and the EU, continue to grapple with excess merchandise in their warehouses.
Dr. Srinivasan highlighted that the textiles and clothing industry in India is particularly hard-hit due to challenges in raw material procurement (both cotton and man-made fibers) and a substantial increase in power costs across key textile manufacturing states. Urgent policy measures were suggested, including the removal of an 11% import duty on cotton, addressing Quality Control Order (QCO) issues, and resolving price concerns related to critical materials like PTA, MEG, polyester, and viscose.
Dr. Srinivasan urged the Indian government to reconsider policies related to raw materials, power, labor, and new investments until the industry undergoes a revival. Suggestions included a one-year moratorium for loan repayments, converting short-term loans into long-term ones, and extending additional working capital to prevent textile units from becoming non-performing assets (NPAs) and to avoid job losses.
Navigating Towards Recovery In conclusion, while the global textile industry faces formidable challenges, the ITMF survey suggests a glimmer of hope with a significant portion of respondents anticipating improved business conditions in the first half of 2024. The call for strategic policy interventions resonates as the industry seeks to recover and enhance its global competitiveness, particularly in countries like India, where tailored measures could propel textile enterprises towards resilience and growth.