Tiruppur garment manufacturers in knots as domestic demand slumps 60 per cent
TIRUPPUR: For the Tiruppur knitwear industry that’s already facing headwinds in the export market due to competition from Bangladesh and China, trouble is brewing in the domestic front too as knitwear production in the city for the Indian market, valued at Rs 30,000 crore, has dropped by nearly 60% this year.
Garment manufacturers, who fear a significant job loss due to the slump in demand, say that cost of production in states like Punjab and Gujarat is cheaper by at least Rs 80 per garment than Tamil Nadu due to those states’ proximity to manufacturers of man-made fabric (MMF or synthetic). Tamil Nadu government must set up a special committee to protect the domestic industry and promote production of synthetic fabric in the state, they said.
M P Muthurathnam, president, Tiruppur Exporters and Manufacturers Association, said, “For Tiruppur, along with exports, domestic production plays an important role. Around Rs 30,000 crore worth of knitwear is produced every year for domestic markets across the country. But this year, our domestic orders have dropped by 60%.
Usually, most of our orders come from cities like Delhi, Mumbai and Bengaluru. But this year, our orders have gone to Gujarat, Punjab, Bihar and Odisha. The main reason is the difference in the cost of production.”
“Domestic production is now dominated by garments made from MMF rather than cotton,” Muthurathnam said.
“We source these fabrics from cities like Surat and Ludhiana. We process, stitch and send finished garments from Tiruppur. As large-scale domestic production units have been started in other states, the demand for garments from Tiruppur has come down. We provide higher wages to labourers in Tiruppur and ensure zero-discharge of effluents.
The transportation cost itself is Rs 18 per kg. These factors lead to cost escalation and our competitors do not stick to such guidelines. As the fabric is available closer to them, the cost of production is relatively lower than us,” Muthurathnam said. He added that the state government should take steps to promote the production of synthetic or MMF fabrics here.
M G Kumar, V-P of Tiruppur Seconds Baniyan Owners’ Association, said, “In Khadarpet, Tiruppur’s hub for domestic knitwear trade, there is a huge stock of knitwear. Orders from Delhi and Mumbai have dropped. We buy synthetic fabrics from northern states and manufacture garments, creating the price difference. The demand for pure cotton garments is going down as polyester ones are cheaper by Rs 170 per piece.”
“Cheap synthetic fabric from China and Bangladesh are being brought to Kolkata. Some restrictions should be imposed on import of the fabrics. MMF fabric production should be promoted in TN,” Kumar said.
