Exploring New Value Chains in Textile and Garments in South Asia  Building Back better from COVID 19
Channel: UNESCAP SSWA
Date: 2021-09-06

Textile and garments (T&G) sector is one of the core constituents of South Asia’s economy, currently estimated to be providing for about 40% of employment in manufacturing. The heavily trade dependent T&G sector of the South Asia faces several emerging challenges due to a number of exogenous factors such as shifting demand and supply patterns in the world market and endogenous factors such as eroding traditional competencies such as low labor costs and artificial intelligence. The COVID-19 pandemic has further aggravated the situation due to which factories were closed, many jobs were lost, and export orders were cancelled. Countries in South Asia face challenges in the form of; (1) rising market competition due to fast growth in textile sectors in other developing countries, such as Vietnam and Myanmar in Southeast Asia, (2) product diversification and deepening of value chains in competing regions and correspondingly shifting global sourcing patters, (3) emergence of new sources of productive competencies in the industry and advancements in technology leading to automation and shifts away from labor-intensive production processes, and emergence of e-commerce, (4) erosion of trade preferences, particularly for graduating LDCs of South Asia – Bangladesh, Bhutan and Nepal – which are expected to lose LDC specific duty-free quota-free (DFQF) market access enjoyed in various markets, and (5) disruptions to the global supply chains due to COVID-19 pandemic.

The South and South-West Asia office of UNESCAP, New Delhi commissioned studies with the objectives of assisting the policy makers and private sector in the subregion in taking evidence-based informed decisions for preparing its T&G sector for meeting the challenges ahead, explore the opportunities and create new regional value chains in T&G sector in South Asia. The studies explore reform requirements for addressing both domestic and external challenges faced by the sector, measures to enhance cost efficiency, improve investment climate, nurture entrepreneurship, enhance productivity, promote product diversification, facilitate greater value addition, expand external market access through engagements in trade negotiations with key trading partners and execute strategies to recover from disruptions to the textile sector caused by COVID-19.

The Expert Group Meeting is organized by the South and South-West Asia office of UNESCAP, New Delhi to present and discuss the methodology and findings of these studies. The objective of this meeting is to benefit from the views of experts to further refine the findings, if any and discuss way forward.