Gujarat textile Industry facing demand crunch

It is a scorcher of a summer for Surat in India, the largest textile cluster in the country with demand for textiles showing no signs of revival since the festive season of Diwali last year. The situation is so grim that around 5,000 of the city’s small traders who conduct their businesses from rented premises are finding it difficult to even renew their rent agreements.

The textile demand from European Countries and from America has reduced to around half of the average demand at this time of the year. While the ongoing Russia-Ukraine war has taken a toll on demand in European countries, recessionary headwinds are responsible for lower demand in America.

This subdued performance of the textile industry could be attributed to “the change in consumption pattern after the Covid pandemic which has changed the consumption patterns. Consumers are spending more on lifestyle goods like healthcare and travel which has suppressed textile demand.

The pandemic has also changed the costing pattern of the industry. The workers who migrated due to the lockdown have not all come back. This has led to a shortage of labour which has increased the cost of production overall.