India's textiles export hub Tiruppur stitches a new tale after FY24 setback

With a contraction of 14 per cent in knitwear exports during 2023–24, India's textiles export hub Tiruppur is back in positive terrain in 2024–25, with the first three months seeing a rise in exports.

This revival is mainly driven by major orders from global players like Primark, Tesco, George at ASDA and Decathlon.

While in April it was marginal at 1.5 per cent, May and June saw a rise of over 11.4 per cent and 10 per cent, respectively.

The region is also seeing a beeline of other brands which include US players like GAP, Carter's and Walmart. There are also European majors like Next and Duns, and Australian giants like Target and Woolworths, according to the Tiruppur Exporters Association (TEA).

 

Export numbers were in negative terrain for 10 months in the last financial year. This was owing to multiple reasons like the war in Ukraine, the financial crisis in Europe and the United States, and global businesses not coming back to normalcy.

“We have seen over 10 per cent rise in June also. This is mainly driven by the global majors diversifying their sourcing basket due to the "China Plus One" policy and a major wage hike in an important market like Bangladesh,” said K M Subramanian, president of TEA.

Late last year, Bangladesh reportedly announced a 56 per cent increase in the monthly minimum wage to $113 from the previous $75 for garment factory workers. This has now forced global buyers to look at other traditional sourcing hubs like Tiruppur.

According to data shared by TEA, the region's exports in April 2024 stood at $294 million, up from $290 million in April 2023. And in May 2024, they were at $360 million versus $323 million last year.

At present, Tiruppur accounts for 90 per cent of the country’s cotton knitwear exports and 55 per cent of all its knitwear exports.

During the calendar year also, except for a dip of 3.8 per cent in January, all the other months saw the exports rise.

In February, the increase was 6.4 per cent and in March it was around 5.6 per cent compared to the same months last year.

"We are yet to see the peak. This is because of Europe and the possible US recession when people were conservative in placing orders. The rise in cotton prices also hit trade. Now, the markets are coming back to a new normal,” said R Senthil Kumar of Premier Agencies, a micro, small and medium enterprise (MSME) based out of Tirupur.

According to him, stabilising of cotton prices due to better supply-demand situation and Bangladesh wages nearing Indian rates helped the order book.

One of the major issues haunting the region was its labour shortage. However, after elections, this situation is also improving. Before polls, the city was seeing a shortage of around 40 per cent in migrant employees. Now, it has come down to 10 per cent with facilities for employees increasing, said industry sources.

Tiruppur's textile industry has 600,000 inland employees and 200,000 migrants.

The rise in orders also gives a push to activities in the entire cluster. These include knitting units, dyeing and bleaching units, fabric printing, garmenting, embroidery, compacting, calendaring, and other ancillary units.