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Why source garments from India. And How?

Updated: Dec 15, 2023

The Indian clothing sector is ranked 3rd in the World, after US and China. It accounts for a large amount of employment in the country and almost 5% of the GDP of the country, which is huge. Total textile and apparel exports from India exceed $100Bn and comprise over one fourth of the foreign exchange earnings for India. Therefore this sector has seen major growth in the last few decades and has made rapid leaps both in terms of availability of raw material, manufacturing capabilities, skilled manpower and supply chain networks.

However given the size of the country and the chaotic nature of doing business here, it can appear daunting at first, to contemplate doing business here. In this article, I will try and talk about why you should or shouldn’t put India on your sourcing plans, and in case you do, what would be the reasons for you to do so and how to navigate these choppy waters.

India's share in Garment exports worldwide

1. The market: 61% brands worldwide procure textiles, garments or accessories from these top 4 countries - India, China, Bangladesh or Vietnam. These countries have emerged as hotspots for manufacturing of garments and apparel for various reasons but which primarily began with the low cost of labour. Apart from that, availability of raw material as well as manufacturing facilities and infrastructure have played a key role in the emergence of these countries as the main destinations for garment exports to the world.

2. Pros and cons of sourcing garments from one vs the other

a. China

As the factory to the world, manufacturing in China emerged in a major way post 1980s, driven by government policies aimed at enabling local manufacturers to sell at rock bottom prices and create humungous scale that no-one else could compete with. However this has led to two major obvious fallouts.

i) Firstly as typical of industrialised countries with wages and standards of living increasing, and as population growth slowed with the One Child policy in China, there has been a discernible shift away from labour intensive garment manufacturing processes.

ii) The second major fallout which affects importers or buyers who are able to buy from China only for large quantity standard items that are possible to make at scale and at low cost. For short runs and as needed by a fast changing fashion industry worldwide, this is a major bottleneck.

Therefore if you are a big brand and buying in large quantities, then China may still be the preferred option. That doesn’t mean there are no large scale manufacturers in India, Bangladesh, Vietnam or even in Sri Lanka, Pakistan or Turkey. In fact there are many and many who do give stiff competition to the Chinese. But indeed the Chinese do have an edge when it comes to low cost, standard products manufactured in long runs. Check the table below for a curated list of some large factories in other parts of the world.

Minimum wages in top 4 garment manufacturing countries worldwide

b. Bangladesh

Driven by free trade agreements with EU, Japan, Israel, South Africa and Hong Kong, Bangladesh emerged as a major low cost garment manufacturer over the pst years. This was also enabled by the extremely low cost of manpower as compared to other countries.

However this low wage structure is also indicative of the low level of economic development in the country, which can impact you as a buyer in unforeseen ways, as was evidenced in the 2013 Rana Plaza collapse, in which over 1,135 garment factory workers died. Such incidents can also severely impact your supply chain and lead to a significant risk for your brand’s reputation! That having been said, there are several large and credible manufacturers in Bangladesh as well, which are featured in the list below.

c. Vietnam

Another powerhouse in the garment manufacturing business worldwide is Vietnam, which enjoys free trade agreements with several countries, under the CPTPP i.e. the Comprehensive and progressive agreement for trans pacific partnership. It’s low labour cost compared to China has also enabled the development of the sector in Vietnam. But labour cost alone does not translate into a proportionate cost benefit of finished goods as electricity, water, taxes, and materials still make up the bulk of the production cost. The gap between Vietnam and China is not as big in these areas.

But the major obstacle in Vietnam is access to raw material like velcro, zips and the textile itself that is mostly not made in Vietnam. Therefore Vietnam manufacturers are dependent on cheap Chinese raw material to make finished goods, which may sometimes be a problem and not result in a major advantage Vs China.

d. India

Due to its size and chaotic nature, doing business in India may be stressful but there are several distinct advantages of doing so. A few years ago, it was not possible to get high quality woven or organic fabrics in India but with major strides ahead, today there are no restrictions on what fabrics can be sourced in India. In fact, Suvin - considered the finest and longest staple cotton in the world as well as all kinds of organic and recycled fabrics are also made in India. Brands like Loomstate, C&A, Patagonia, Walmart, Marks & Spencer and many others, source a large amount of garments from India, especially in the high end and organic segments. The advantages that India brings to the table are as follows:

The best cotton in the world is made in India
How to source cotton garments from India

i) Local availability of raw material: India is among the top 3 cotton manufacturers in the World and the 2nd largest spinner. 51% of the World’s Organic cotton is grown in India, compared to 19% in China, as per the Textile Exchange Organic Cotton Market Report. All other raw materials required for garment manufacturing like zips and buttons are also made locally although in the last years, cheap Chinese products have made inroads in the market. However with the highly negative China sentiment and calls from across the industry to Boycott China, this sector will increasingly go back to local in the times to come.

Relative share of cotton production in top 4 countries
Thousand Metric Tonnes of Cotton Produced

ii) Manufacturing Facilities: India has lakhs of big and small garment manufacturing units with varying degrees of organisation and credibility. They range from mom and pop outfits to very large industrialised setups. It is important to have a local partner who can identify and get things done depending on the size of the order or target quality Vs price point as a lot of the very small outfits are also very high quality and reliable.

However for brands looking for premium or certified manufacturing facilities, India has over 1,254 GOTS (Global Organisation for Textile Standards) certified factories compared to 220 in China. There are over 977 SA800 certified units in India compared to 606 in China and 4 in Bangladesh. 40% Fair trade cotton is produced in India and there are over 217 GRS (Global Recycled Standard) facilities in India. Therefore no matter whether you may be looking for a small customised range of products or a very large quantity in short time, both are equally possible in India, with the right partners.

iii) Lower MOQs and Flexible Production: Indian manufacturers are usually more flexible on the minimum order quantities and different units work with different minimum requirements. So if you want just 500 pieces of a product, or 50 thousand, both are possible to get done.

iv) Language and culture: With its English speaking population and cultural affinity with the west in terms of democratic and capitalistic society, Indians are generally easy to work with and understand customer needs well.

v) Hot bed for innovation: The Indian apparel industry is currently a hot bed for innovation and there are thousands of small and big innovations happening here simultaneously, for e.g. brands like Boheco that are trying to reduce and replace cotton in textiles with the more sustainable hemp filers. There are companies working on anti-viral and anti-bacterial treatments of fabrics for special applications. There are also companies making organic milk or rose, banana, soya bean, lotus, eucalyptus and other fabrics.

vi) Rich Heritage: Last but not the least, India has a long and rich textile heritage and a large network of heritage and handmade textiles like Bandhini, Chikankari, Ikat, Pashmina, Benarasi Silk and many others, which are absolutely stunning and look gorgeous on their own or also in Indo western fusion styles.

With all these advantages, India does present a credible large scale sourcing option, that it already is. But since it is a large country and there is such a wide set of materials and manufacturers available, many importers find it helpful to work with a local partner like the NoName Company, Impulse etc who can support and strengthen the procurement process by managing local factory identification, quality control and ensuring industry best practices are followed for manufacturing as well as logistics.

However if you want to go on your own, Google is your best friend and you can of course search for yourself or if you like, approach any of the following manufacturers directly from this list of the top garment manufacturers in each country.

Garment manufacturers in each country
Top garment manufacturing companies in the world

All the best for manufacturing / sourcing garments from wherever you do. We are all in this together and if there is any way we can be of help, please do not hesitate to contact us!


Pankaj Agrawal

The NoName Company

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