In the past two months, the rapid deterioration of the second wave of COVID-19 in India has become the most notable event in the global fight against the epidemic. The epidemic has led to the closure of many factories in India and the plight of many local and multinational companies. At the same time, many Southeast Asian countries are also affected by the epidemic, and a large number of enterprises have stopped work or closed down.

India's garment industry has lost a number of export contracts

According to media reports, due to the blockade measures during the epidemic, India's garment industry has suffered a severe contraction in exports, which will decrease by 24% in 2020. In the new outbreak, Indian companies lost a large number of garment export contracts because workers could not get to work.

In Delhi and Bangalore, the garment industry's Labour absenteeism rate is as high as 50 per cent. Industry insiders said that normally this time of year is the peak time for orders, but now buyers are more cautious.

Some textile traders in Surat, India, say business is down almost 90 percent. The textile industry in Surat, home to 65,000 textile traders, is losing at least US $48 million a day if calculated on average. At present, the entire textile industry in India is facing a sharp decline.

Surat's situation is a microcosm of India's textile industry, which is in rapid decline.

Nearly 400 companies are exiting the market every day

India is not the only country affected by the outbreak. Vietnam is also affected.

In the first five months of this year, the number of newly established enterprises and the total amount of newly registered capital in Vietnam reached 55,800 dong and 778.3 trillion dong respectively, with year-on-year growth of 15.4% and 39.5%. The average registered capital of new enterprises was 14 billion dong, up 20.9 percent year on year.

In addition, nearly 22,600 enterprises resumed work and production, up 3.9 percent year on year. A total of 78,300 enterprises were newly established or resumed production.

On the other hand, the total number of enterprises suspending business, suspending business and waiting for dissolution procedures or completing dissolution procedures reached 60,000, with a year-on-year increase of 23%.

Among them, 31,800 were temporarily closed, up 22.3 percent year on year; 20,000 enterprises closed down and waiting for dissolution procedures, up 20.7% year on year; 8,000 enterprises completed the process of dissolution, up 32.3% year on year. On average, nearly 12,000 companies leave the market each month, equivalent to 400 companies a day.

Southeast Asian countries are facing an urgent epidemic

In addition, in recent days, other Asian countries have also shown signs of heating up, with Pakistan, Cambodia, Vietnam and other Asian countries also suffering from COVID-19.

Pakistan: Cumulative total of 938,000 confirmed cases and 20,000 deaths. Workers are currently unable to go to work due to a total blockade and strict restrictions on transport between provinces. The country's textile industry will suffer huge losses and production will decline significantly.

Cambodia: 37,000 confirmed cases of COVID-19 and 311 deaths have been reported so far. Cambodia's garment industry, which employs 850,000 people, is a priority for vaccination, with half of garment workers in the worst-hit areas already vaccinated.

Vietnam: Confirmed cases of COVID-19 peak. At the moment, Vietnamese textile companies are struggling to find workers. Due to increased restrictions on movement of people, Ha Long Bay and Lan Ha Long Bay have been closed until further notice. The Vietnamese government has suspended entry procedures for all foreigners.

Indonesia: Partial lockdown is currently in place due to the severity of the outbreak. As a result, it is difficult for workers to get to work and they need to be tested negative, but most do not get tested regularly. The country's textile industry is set to grow at an average annual rate of 5 per cent over the five years from 2021 to 2026, with exports driving growth.

A large number of orders from Southeast Asia were diverted to China

Affected by the epidemic, apparel exports from India and other Southeast Asian countries have suffered a severe contraction, and some orders for textiles have been transferred to China. A person in charge of a textile enterprise in Jiangsu Province said that some orders originally from India had returned to China because the local epidemic repeatedly caused the operating rate of textile enterprises to be low.

In the workshop of a garment company in Dongguan, more than 200 looms are running at high speed, and workers are churning out orders in an orderly manner. "Some orders from Southeast Asian countries, including India, have been transferred 40 percent to our company, and now the opening chance is 100 percent," said the company's director.

According to customs statistics, from January to May this year, China's textile and garment exports reached US $112.69 billion, up 17.3% year on year. Of this, textile exports reached 56.08 billion US dollars, up 16.1 percent over the same period in 2019; In the month of May, apparel exports were $12.20 billion, up 37.1 percent year on year.