Import ban on Bangladeshi RMG triggers supply crunch in India

Leading international clothing retailers in India, including Marks & Spencer, H&M, Zudio, and Lifestyle, are facing supply shortages amid a prolonged restriction on imports of readymade garments from Bangladesh through land ports, The Economic Times reported yesterday.

The Directorate General of Foreign Trade (DGFT) of India issued a notification on May 17 banning garment imports from Bangladesh via land routes. Imports are now allowed only through the Kolkata and Nhava Sheva seaports, causing significant disruptions in the supply chain.

The move has led to delays of two to three weeks in merchandise sourcing, especially in lower-price categories. As a result, several Indian retailers such as Lifestyle, Reliance, and Aditya Birla have started shifting part of their production domestically.

"While we have shifted some of our sourcing within the country, there are a few categories that we import from Bangladesh, which have been delayed due to the decision," said Devarajan Iyer, chief executive officer of Lifestyle International. Smaller retailers and grey-market operators, who rely heavily on low-priced products and faster deliveries, are bearing the brunt of the import ban.

"The cost of importing garments from Bangladesh could rise by 3 to 5 percent due to higher transportation costs through seaports. However, the impact will not be immediate as many retailers had secured contracts months in advance," said Rahul Mehta, chief mentor of the Clothing Manufacturers Association of India.

Imports from Bangladesh have already dropped 25 percent year-on-year, according to Sanjay Jain, managing director of textile and apparel company TT Industries.

Between January and June this year, India's imports of garments from Bangladesh stood at $254.44 million, up 3.5 percent from $245.84 million in the same period a year earlier, The Economic Times reported, citing data from the Confederation of Indian Textile Industry and the International Trade Centre.