The plant was set up at a cost of Rs 100 cr and will employ over 2500 people in the first phase. More people will join later, the company said.
Ethiopia also gives the company lower-cost manpower, highly subsidised power, readymade industrial sheds that considerably reduces capital expenditure along with duty benefits, it said.
The capacity expansion will mark Raymond’s entry amongst the top five suit manufacturers in the world, the company added.
“It is a strategic decision to set up a garment manufacturing unit in Ethiopia to mitigate our risk as far as our exports are concerned,” said Gautam Hari Singhania, chairman of the group.
Indian garment exports have suffered in recent months because of a stronger rupee that has made Indian items costlier abroad.
The plant will ensure duty-free access in key export markets such as USA and Europe, the company said.
“In our endeavour to ensure price competitiveness, Ethiopia makes a compelling business case and enables us to serve our international customers,” Singhania added.
Though the availability of skilled labor may not match that of India, the company will upskill the local labor using a “highly experienced expatriate team” from India.
“Leveraging the skillsets of garment manufacturing facilities on the domestic front, which are acquired over a period of time, this quantum leap into an international location for manufacturing has been triggered by both core competence and business considerations,” Singhania said.
Christened as the Silver Spark Apparel Ethiopia PLC, the local unit is amongst a host of other International Investors who have set up their facilities at the Hawassa Industrial Park in the African nation.
This Park would be an international hub of Garmenting – with representation of several Companies – world over. Silver Spark Apparel Ltd. is one of the largest manufacturers of high end Suits, Jackets , Trousers & Shirts, exporting to leading international markets such as USA, EU and Japan.
Silver Spark Apparel Ltd is the only Indian manufacturer with an expertise to craft Full Canvas Suits — Raymond said.
The company currently has four facilities in Bangalore.
“We continue to stay committed to Make in India and have invested in a green field project,” the company said.
Besides being a manufacturer, Raymond also has one of the largest exclusive retail networks in the country with over 1000 stores across 400 towns.