In what may indicate the end of bad times, at least for the better-off in the textile and garment sector, the country’s largest garment exporter, Gokaldas Exports, is back to its expansion mode.
The company will be starting up its new factory in Hyderabad later this month which had been put on the backburner last September due to the recession in US and European markets.
“Things are definitely looking up and we are operating at full capacities in all our 46 factories,” said Rajendra J. Hinduja, managing director, Gokaldas Exports. “For us, the worst is clearly over and we will be inaugurating our factory in Hyderabad in the second half of September. The factory has a production capacity of 1 lakh garments per month.”
The Rs 1,175-crore company has 46 factories in the country spread over 42 locations in three states and has a cumulative production capacity of 1.5 lakh garments per day.
Gokaldas is also looking to set up another factory in Mysore before the end of the current financial year. “Over the last six months our order book position has improved and the Christmas orders so far are in line with expectations,” Hinduja added. “It’s not back to the levels of 2006 and 2007, and that will take sometime to come. The recession for the smaller exporters would be longer though and while a lot of the players are already dead some others will still be washed away.”
At least half a million workers in the domestic textile and apparel sector are jobless due to tumbling retail sales in the United States and the European Union since the global economic meltdown began a year ago.
In 2008-09, garment exports were 13 per cent short of the $11.62 billion target and totaled $10.17 billion.
In the first quarter of current fiscal, exports have dropped by 15.4 per cent at $ 2.41 billion compared to $ 2.85 billion in the same period of last year.