The worldwide economic downturn and dwindling global trade have done serious damage to India’s textile and garment industries. Since July 2022, shipments to the US and the EU have been declining steadily, despite the industry’s heavy reliance on established markets like these.
According to the Indian ministry of commerce and industry, India exported textile and clothing products worth $22.33 billion in the first half of 2022. But, in the second half of the year, that amount dropped to $16.21 billion, a decrease of 27.40%.The US and EU economies’ inflation rates are rising, with prices in the US rising by 5.4% over the previous year in January 2023 and the core inflation gauge rising.
4.7 percent more. Core price increase in Europe reached a record-breaking high of 5.3%. In order to solve the problem, central banks have raised interest rates, which could have a detrimental impact on investment. High energy costs are increasing the inflationary pressures for consumers and businesses. Also, because inflation is rising faster than nominal wage growth, consumption may continue to be weak in the short run.
India’s textile and apparel exports to the US decreased by 23.94% to $4.70 billion from $6.18 billion during January to June 2022, a drop of 23.94%. Similarly, according to TexPro, a market analysis tool from Fibre2Fashion, India’s export to the EU-27 countries fell by 24.54 percent to $3.29 billion in the second half of 2022 from $4.36 billion from January to June 2022. sales to these Since July 2022, regions have been steadily falling, with just a little increase in November and December—possibly because of the holiday season.
In 2023, the decline in India’s exports of textiles and clothing is predicted to continue, raising the likelihood of layoffs in a sector that employs over 45 million people.