How is the Indian textile and garment industry navigating global challenges like inflation, reduced orders, lower demand, rising costs, and stricter regulations?
Geopolitical factors have led to a slump in demand for production in Asia, affecting Western brands, especially from the EU and USA, causing a drop in income due to market correlations and inflation downturns. This has also impacted technology companies and consumption patterns post-COVID-19, jeopardizing sustainable growth. India's export market has transformed, with reduced demand for exports and branded goods, exacerbated by global economic distress and fewer orders from the US. Despite challenges, India presents growth opportunities in apparel, local businesses, and leisure.

Consumer behavior has shifted towards experiences over clothing, affecting retail companies in India, prompting adaptation to changing preferences. While recent growth has been below expectations, there are prospects for innovation and future growth, as companies navigate through geopolitical and economic uncertainties.

What is the current mood in the textile sector in India from your perspective?
The textile sector in India experienced stress in the last quarter of December, with people feeling somewhat nervous. However, this quarter, with the onset of local festivities following the new year, there's been a shift from pessimism to optimism. India's economy and GDP are growing faster than most global economies. This positive sentiment is fueling an interest in expanding categories and markets, leading to innovation in product solutions and improved agility in the industry.

The recent Bharat Tex event in Delhi, one of India's largest textile events held in February, was well-received, drawing participation from apparel crowds globally, with over 3,000 international buyers. This upbeat mood is supported by the economic growth momentum, with GDP projected to reach 6 to 7%. There's a strong belief that the coming financial year will see recovery from the downturn experienced in the previous years.

The garment sector, despite being influenced by demand and seasonality, is being regarded as a crucial component of India's textile, apparel, and garment value chain. Overall, there's a positive global momentum observed, indicating promising prospects for the sector.

How is ABFRL addressing issues related to sustainability and ethical practices in the supply chain, considering the increasing global emphasis on responsible and eco-friendly fashion?
Regarding sustainability and ethical practices in the supply chain, ABFRL has been proactive in addressing these issues. The company embarked on its sustainability journey almost a decade ago, launching initiatives in 2013 with a focus on giving back to the ecosystem. These efforts have been driven by a commitment to sustainable practices and achieving targeted goals, including resource efficiency and environmental stewardship. ABFRL remains dedicated to its sustainability objectives, transitioning towards a circular economy model and leveraging digitalization to optimize production and enhance efficiency in core areas like energy and water management.

Why do you think that circular economy and digitalization will be the most important enablers for the core areas of energy, water, safety, CSR, waste and green buildings in the textiles and garment sector?
In considering the environment within the industry, it's apparent that the economic landscape is fraught with challenges such as financial strain and overproduction. This has created immense pressure on material extraction, particularly concerning water, energy, and raw materials. To address these issues, we are focusing on resource efficiency, recognizing the potential for optimization. Our approach extends beyond manufacturing and supply chain operations to encompass lifecycle assessment, emphasizing an integrated sustainability strategy.

Lifecycle thinking is pivotal, guiding our product design, development, production, logistics, retail operations, and store optimization processes to create a more resource-efficient and sustainable value chain. For instance, initiatives to reduce water consumption involve innovations in recycling, reuse and renewable sources. Similarly, efforts to reduce energy usage and optimize material consumption are driven by scientific methodologies. Within the conventional linear model of production and consumption, commonly employed by many global brands and fast fashion companies, where products are manufactured, sold, and disposed of, sustainability is compromised. To transition from this linear approach to a circular one, it is important to prioritize the principles of reduce, recycle, and reuse. However, this transformation requires more than just individual efforts; it's necessary to establish a comprehensive ecosystem to circularity. Driving this transition requires collective action within the industry, aligning stakeholders and fostering dialogue to design solutions for a future-ready textile and apparel sector. This transition from linear to circular is pivotal and represents a significant stride towards sustainability.

Can you shed light on any specific technological advancements or innovative practices that ABFRL has adopted to enhance the efficiency and sustainability of its manufacturing processes?
In addition to striving for increased efficiency, ABFRL prioritizes transparency in its manufacturing processes. The company implements technological advancements and innovative practices to achieve these goals. For instance, ABFRL is the first retail company in India to employ Product Lifecycle Management (PLM) technology, which tracks a product's journey from design to sales and delivery. This platform facilitates the integration of lifecycle assessments into manufacturing operations, a unique approach in the industry.

ABFRL also emphasizes resource efficiency initiatives, such as achieving water positivity in its operations and obtaining net zero water certification for one of its factories. These efforts, coupled with the adoption of the Higg Index for measuring environmental impact, have positioned ABFRL as a global benchmark for sustainability in the garment sector.

Furthermore, ABFRL's commitment to zero waste practices ensures that all waste generated in its factories is either recycled, reused, or reprocessed, contributing to both efficiency improvements and sustainable practices.

With industry associations expressing concerns to the government about potential financial stress for textile units, especially MSMEs, how is ABFRL collaborating with industry stakeholders and engaging with government policies to address the challenges faced by the broader Indian textile sector?
As one of the largest fashion companies with over 30 brands, ABFRL operates primarily in India, making it a significant player in the textile sector. Given that the garment industry is largely comprised of MSMEs, ABFRL consistently collaborates with its partners, providing support and guidance to enhance productivity and efficiency. 

The Indian government has also shown support for the textile and apparel sector through initiatives like the Production Linked Incentive (PLI) scheme and the PM MITRA initiative (PM Mega Integrated Textile Region and Apparel), which focuses on creating integrated textile and apparel parks. ABFRL actively engages with such government initiatives to further support its supply chain partners, recognizing their importance in the industry ecosystem.

Through long-term relationships and initiatives like the Green Channel Partnership, ABFRL fosters mutually beneficial partnerships with its vendor partners, contributing to confidence-building and stability in the supply chain. This approach prioritizes partnership over short-term transactions and is instrumental in supporting MSMEs, which form a significant portion of ABFRL's supply chain.

Given the prevalent violation of minimum wage norms in many factories, how does ABFRL ensure that workers involved in the production of its garments are paid fair and what mechanisms are in place to address any instances of non-compliance?
I'd like to emphasize the value of our company and our commitment to sustainability, which is deeply ingrained in our philosophy. One crucial aspect of responsibility is ensuring diversity, both locally and globally. We ensure compliance with all applicable local and global standards across our facilities, adhering to frameworks and guidelines set by organizations like the UNGC. Stakeholder engagement is another key pillar of our sustainability efforts. We prioritize collaboration and engagement with stakeholders to address challenges and drive innovation. Our approach focuses on long-term collaboration, considering global standards and future sustainability in our business practices. These principles guide us in evaluating our value chain, including our supply chain, and we have established standards and policies to ensure compliance with global standards and ethical conduct.

In your opinion - How will the Indian textile sector develop over the next few years?
The Indian textile sector will develop significantly in the coming years. India occupies a prominent position as one of the largest textile exporting countries and is best known for its high quality yarn, fabric and fiber production. As one of the world's largest textile and apparel producer, the demand for Indian textiles remains robust due to the country's expertise and extensive retail network in this sector.

In addition, India serves as a major manufacturing and supply chain hub for global fashion brands, underlining its strategic importance in the global textile industry. Moreover, India's emergence as a fast-growing consumer market has attracted global brands to set up operations in the country.

The Indian textile market plays a pivotal role both in exports and domestically, serving as a technological exporter to the global market while catering to the needs of domestic consumers. With a diverse range of textiles and a strong supply chain infrastructure, India is well positioned to meet the demands of both domestic and international markets.

ABFRL has a vast network of nearly 4,000 stores and a presence in over 33,000 multi-brand outlets and department stores across India. Looking ahead what are the company's next plans?
In India, there is a significant demand for fashion and lifestyle products. We are highly optimistic about the Indian market and view Indian consumers as increasingly fashion-conscious. They are seeking lifestyle and fashion elements in a manner similar to consumers in developed countries. Our aim is to tap into this growing market and cater to the aspirations of the local populace, especially considering India's young demographic profile.

Dr. Naresh Tyagi, Chief Sustainability Officer at Aditya Birla Fashion & Retail Limited (ABFRL), brings over three decades of experience in the Textile, Apparel, and Retail sectors. Believing in the collective responsibility of society and businesses for a better future, he advocates for sustainability at all levels. Dr. Tyagi's leadership has led to innovative and strategic initiatives across functions, with a focus on environmental and social causes. Actively engaged in global and national industry platforms, he contributes to initiatives such as Cotton 2040, Circular Apparel Innovation Factory (CAIF), and Science Based Targets initiative (SBTi), driving progress towards a circular textile and apparel industry ecosystem in India.