Textile industry and trade are facing poor demand from the global market due to the economic slowdown and high inflation. Higher prices of cotton and other fibres are also pushing the cost of production up, thus squeezing the profit margins of manufacturers. The risk of the new COVID wave is another challenge for the industry, which is already dealing with unfavourable market conditions. 

Trade sources said that market sentiment further dampened after reports of COVID spike in China and rising risk in India. There is a general sense of uncertainty in trade because buyers and sellers are clueless about the future scenario of pandemic. 

Some experts are of the opinion that India might be a soft target of the pandemic because of its proximity to China, while others feel that India is already past its worst COVID wave that hit the country in April-June 2021. Traders said that trade activities will be disrupted only if lockdowns are imposed. 

“Manufacturers have reduced their purchases as they do not want to take more risk,” Nikhil Jain, a trader from Ludhiana, told Fibre2Fashion. They had already been facing losses due to low demand and the high cost of production. 

However, a Delhi-based trader was optimistic. He said that probably the situation will not deteriorate to the extent it did earlier. The things will be clearer in the next one or two weeks. Hopefully, the situation will be under control in China in the next few weeks and the impact of the present wave will be milder than before. 

A cotton trader from Bathinda was also optimistic as he hoped to get some advantage from the improving demand for Indian cotton and yarn after a disruption in the Chinese industry. He told Fibre2Fashion, “A sharp rise in COVID cases in China may disrupt the normal trade and industry. Probably, exports of cotton, yarn, and fabrics from China to India and other countries will be affected. Therefore, demand may divert to India which may help support the prices of textile products.” 

Fibre2Fashion News Desk (KUL)