Domestic apparel makers report 84% drop in May sales as focus shifted to manufacturing masks: CMAI

Bengaluru: Domestic apparel makers have noted a sales drop of 84% during the month of May over the same period last year, predominantly as some factories shifted business focus to manufacturing masks and PPE products, said The Clothing Manufacturers Association of India (CMAI) that represents leading firms including Aditya Birla Fashion and Lifestyle, Arvind Fashions, Future Group, Shoppers Stop and Raymond.
A survey conducted by the apex body amongst its members at the end of May noted a decline in sales for the month. “Compared to the corresponding period of May 2019, the members surveyed indicated a drop (in sales) of 84% over last year – and that too, primarily because some factories had started manufacturing masks and other PPE products,” said CMAI in a press statement.

The survey also noted that the domestic apparel business saw “zero” production of regular products this May. Only 22% of the garment factories across the country are operational currently, it said.

“Contrary to what is thought, the situation has hardly improved even after easing of restrictions and attempts to open up the economy. Factories are operating
at an average 25% of their capacity. 40% of the factories that have started functioning, are engaged in the manufacture of current essential products like masks and PPE products,” CMAI added.

According to the survey as of May 15, of those who had applied for the additional working capital loan (Covid Line) as directed by Reserve Bank of India (RBI), only 26% received assistance from their bankers. The balance 74% continue to have their applications in the ‘processing’ stage.

“The garment Industry is going through an unprecedented crisis, and unless immediate steps are undertaken to permit uniform opening up of all shops, market complexes, and malls (maintaining social distancing and health check norms), as well as factories, and the banks step in to assist, the garment Industry in India is heading towards an unmitigated disaster,” said CMAI.

The apex body has recently urged the government to also consider levying a temporary additional Covid import duty on import of readymade garments for a period of 12 months to create a level-playing field. This move was suggested as the domestic garment manufacturing industry anticipates a slow down of demand for a year severely impacting business.