While the apparel exporting industry managed to pay all the workers in the industry their wages for March, it finds itself unable to pay them for April and May, due to cash crunch. With production being brought to a standstill and most of the important export markets across the world being under lockdown, no revenue is being generated. The industry is highly dependent on labour, and almost 30 per cent of its production cost goes into paying wages. Therefore, the Apparel Export Promotion Council (AEPC) has approached the Government for help.
The Council has requested the Govt to pay the wages of the workers in the sector, from the funds available in the Atal Bimit Vyakti Kalyan Yojana (ABVKY) Scheme. It has informed the Govt that it has cleared the wages for all the workers in the apparel exports sector for March, but is in no position to pay them any more.
According to A Sakhtivel, chairman, AEPC, the sector, which is the biggest source of employment in the country after agriculture, requires a relief package at the earliest. The industry is yet to be paid by buyers for the goods that have already been supplied. In addition, most current orders have either been cancelled altogether, or their deliveries have been deferred. The apparel exports sector is staring at a loss of about US$4 billion.
Apparently, buyers across the globe are either not paying up or expecting huge rebates for the orders that were shipped a while back. Many factories are facing the risk of closure, and will naturally result in massive job loss if relief measures are not put in place fast.