Export of Indian apparel to USA market which enjoys 30% of the world market share in the segment has declined from $ 951 million in 2006 to $ 930 million for the year ending March 31,07 registering a decline of by 2.10%, thanks to the continued appreciation of rupee vis-a-vis other competing countries such as China, Pakistan, Turkey, Sri Lanka, Maxico and Bangladesh, says a sturdy by Confederation of Indian Textile Industry (CITI).
Imports of textile and garments together from India to US market dipped by 4% during January-February 2007.
While Indian currency appreciated by 9.14%, Chinese Yuan and Mexican Peso appreciated by 3.87% and 0.02% respectively. China’s exports grew by 63.48% from $2995million to $ 4896 million, Maxico exports dipped by13.33 % from $ 1527 million to 1348 million in the same period. Other major competing countries such as Pakistani, Indonesian and Bangladesh who depreciated their currency registered a growth of 15.47%, 23.19% 16.46% respectively in apparel exports, the study goes on to say.
What is worrying Indian exporters is deceleration of demand for ‘India Look’ fashion garment in the US and other major markets of the world during the last six months during the last six months as high export orientation and low import intensity of this industry makes it particularly vulnerable to currency appreciation.
The situation calls for a serious analysis of its reasons and urgent measures to rectify problem, chairman of CITI, Shekhar Agarwal told FE.
Agarwal said,” Government has been allowing Re to appreciate with the hope that this would will help in containing inflation, it is doubtful whether strengthening of currency will reduce inflation , there is no doubt it would surely bring down exports.
We hope RBI would intervene to arrest the current rally of the Rupee. Other factors creating some anxiety in the industry circles is that TUFS scheme has been kept in abeyance pending completion of the process of restructuring.
Similarly, Rs 1000 crore under the TUFS which expired on March 31, 07 is pending for clearance.
The textile, clothing and machinery industry is eagerly awaiting the early resumption of sanctioning of loans under TUFS, since both have substantial stakes in the scheme, Agarwal said.
He added that slackening of demand in international markets and demand recession within the country, atleast for yarn, our industry is going through tough times” The delay and uncertyainties in announcement of the scheme will only worsen the situation.
Imports of textile and garments together from India to US market dipped by 4% during January-February 2007.
While Indian currency appreciated by 9.14%, Chinese Yuan and Mexican Peso appreciated by 3.87% and 0.02% respectively. China’s exports grew by 63.48% from $2995million to $ 4896 million, Maxico exports dipped by13.33 % from $ 1527 million to 1348 million in the same period. Other major competing countries such as Pakistani, Indonesian and Bangladesh who depreciated their currency registered a growth of 15.47%, 23.19% 16.46% respectively in apparel exports, the study goes on to say.
What is worrying Indian exporters is deceleration of demand for ‘India Look’ fashion garment in the US and other major markets of the world during the last six months during the last six months as high export orientation and low import intensity of this industry makes it particularly vulnerable to currency appreciation.
The situation calls for a serious analysis of its reasons and urgent measures to rectify problem, chairman of CITI, Shekhar Agarwal told FE.
Agarwal said,” Government has been allowing Re to appreciate with the hope that this would will help in containing inflation, it is doubtful whether strengthening of currency will reduce inflation , there is no doubt it would surely bring down exports.
We hope RBI would intervene to arrest the current rally of the Rupee. Other factors creating some anxiety in the industry circles is that TUFS scheme has been kept in abeyance pending completion of the process of restructuring.
Similarly, Rs 1000 crore under the TUFS which expired on March 31, 07 is pending for clearance.
The textile, clothing and machinery industry is eagerly awaiting the early resumption of sanctioning of loans under TUFS, since both have substantial stakes in the scheme, Agarwal said.
He added that slackening of demand in international markets and demand recession within the country, atleast for yarn, our industry is going through tough times” The delay and uncertyainties in announcement of the scheme will only worsen the situation.