Sri Lanka Crisis Increases Global Demand for Indian Textiles and Teas

The textile hub of Tirupur in Tamil Nadu and tea estates of southern India and Assam are witnessing a surge in overseas orders as the export demand has diverted to India from Sri Lanka owing to the economic and political crisis in the island nation. Garments and tea are the major exports from Sri Lanka.

"It has crippled the manufacturing sector in Sri Lanka, especially apparels," said Raja M Shanmugam, president, Tirupur Exporters' Association. "The Sri Lankan apparel industry even imports buttons. Due to the ongoing crisis, global brands have started diverting some of the orders from Sri Lanka to India's Tirupur textile hub. These orders are being placed for the upcoming fall season."

Global brands such as Zara, Mango and H&M place orders with Asian countries, including India, Sri Lanka, Bangladesh, Cambodia and Vietnam. "Bangladesh, Vietnam and Cambodia have huge orders in their hands. The only option left in this scenario is India. However, high cotton and yarn prices are a major concern for the Indian textile trade," said Shanmugam.

Sri Lanka exports $5.42 billion worth of garments to the global markets annually.

While export orders for apparel are being diverted to India, the tea industry in the country, too, has started getting export enquiries from the markets where Sri Lanka used to sell teas.

"Almost all tea processing units in Sri Lanka are witnessing power cuts for almost 12-13 hours a day and have not enough fuel to run their generators. This is leading to production disruption and thereby impacting the quality of black tea leaves," said Dipak Shah, chairman, South India Tea Exporters Association, who was in Colombo a few days ago.

Sri Lanka produces orthodox teas that are exported to countries such as Iraq, Iran, the UAE, Libya, Russia and Turkey. India, too, produces orthodox tea, which mostly goes to Iran and Russia. "Some of the orders from the orthodox tea-consuming nations are being diverted to India," said Shah. He said even packet tea players in Sri Lanka are facing problems as they cannot import packaging materials due to the economic crisis.

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