Despite the crisis looming over the Red Sea, Indian garments and leather products will make it to the shelves in the US and Europe in time for Christmas and New Year this year. Thanks to proper planning, goods were shipped two months in advance to avoid delay during transit.

Usually, goods for Christmas and New Year are shipped by August, but this year it was was completed in June and July due to the increased transit time and delays, said sources.

Last year, the Red Sea crisis hit many exporters leaving world’s two largest markets dry as ships avoided the Suez Canal in view of the Houthi attacks, and went via the Cape of Good Hope in South Africa. This, added to voyage time.

Textile worth nearly $20 billion from India were exported to the US and Europe last year. Leather products worth around $1 billion and $2.3 billion were exported to the US and Europe respectively, according to government data.

Mithileshwar Thakur, Secretary General, Apparel Export Promotion Council, is relieved as the goods will hit the stores in the US and Europe in time for the winter season. Generally, by August they ship the goods to warehouses, from where the goods are delievered to stores. However, this time, they did it in June and July, he told businessline.

Lessons from 2022

Israr Ahmed of Chennai-based Farida Group, a leading exporter of leather goods, and Vice-President, FIEO, said customers are now calculating 100 to 120 days transit time including clearances. Previously, they worked for 70 to 80 days. “We do not have any cushion for delays and this means that if the exporter is late, he is asked to ship by air,” he said.

Sivaramakrishnan Ganapathi, Vice-chairman and MD at Gokaldas Exports, a leading apparel manufacturer, said, “We only did a couple of weeks’ advancement. When we advance more than a certain period in fast fashions, the designers get into a problem, saying that their predictive accuracy of what will sell during the New Year season reduces.”

Cargo had to be shifted from sea to air in 2022, due to a dearth of containers and delay in the ship’s transit time. Now, there is no chance. People have burnt their fingers and are not going to do it. They would rather order early and buy early, he said.

Raja M Shanmugham, former president of Tiruppur Exporters Association, said getting the goods in time to the US and Europe is the biggest concern looming the trade. Geopolitical issues create tough situations. Apparel products are seasonoriented and on-time delivery is imperative. However, this got disrupted, leaving the industry affected..

The government should consider the disruption that geopolitical issues cause the MSMEs. This is on fulfilling financial obligations like paying the dues on time and buyers extending the credit line. This can be considered to handhold MSMEs as an exigency factor. They can provide Emergency Credit Line Guarantee Scheme support at this juncture, he said.

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