The Supreme Court (SC) of India has banned the use of petroleum coke and furnace oil in the Delhi-NCR region to avoid any further harm to the environment.
The decision will reportedly affect the operations of around 150 textile and apparel companies in the region. The firms use a high quantity of these materials (petroleum coke and furnace oil) in the manufacturing process.
The order came into effect when the Environment Protection Authority (EPCA), a Government-appointed body, recommended the court in April this year to ban fuels due to high sulphur levels in the regions.
Delhi-NCR is a garment manufacturing hub and supplies products to many international fashion brands.
The closure of apparel factories will not only impact the business of the garment exporters but also hit the supply and sales of these international brands including H&M, JCPenney and others.
HKL Magu, Vice Chairman, AEPC (Apparel Export Promotion Council) and MD, Jyoti Apparels told Apparel Resources, “The decision will highly impact the businesses of exporters, manufacturers and textile units. This is the peak season and the sudden announcement by the SC Court has left the exporters with no other option instead of closing down the units.”
However, there are many exporters who do not use petroleum coke but procure fabrics from the textile units where this fuel is used in fabric manufacturing process. So, anyhow the SC verdict will affect the production.
“We as an exporter have only fabrics for the next few days of production and now it will be difficult to procure fabrics that will lead to the delay of production,” Magu added.
The ban will lead to the cancellation of orders or the delay in orders that will raise the discount demands from the buyers. There could be a high probability of losing buyers as they will shift to some other areas to meet their demand.
“We can only hope for some support from the Government as in such a short span of time it is difficult to move to an alternate like diesel or gas which will further increase the price of our products. Indian exporters with a hike in prices will become less competitive in the overseas markets,” Magu maintained.