TEXTILE EXPORTS TO TOUCH $13 BILLION MARK
The Indian textile
industry occupies an important position in the country’s economy.
Currently, it accounts for about 14 per cent of the industrial
production and provides direct employment to about 3.5 crore persons.
The textile industry contributes substantially to India’s export
earnings. At present, the exports of textiles, including handicrafts,
jute and coir, account for about 27 per cent of total exports
from India and are the largest net foreign exchange earner for
the country, as the import content in textile goods is very little
as compared to other export products. The export basket from the
sector comprises a wide range of items like cotton yarn and fabrics,
man-made yarn and fabrics, wool and silk fabrics, made-ups and
a variety of garments.
The textile exports
have always shown a positive growth rate barring in the year 1998-99.
The exports recorded a growth of 12.1% in 1996-97, 2.5% in 1997-98,
10.1% in 1999-2000 and 15.1 per cent in 2000-2001. However, a
declining trend was noticed in the textile exports since the beginning
of the year 2001, which was mainly due to the slow-down in the
economies of some of the major importing countries and increased
competition from the neighbouring countries like China, Bangladesh,
etc. The textile exports during the year 2001-2002 amounted to
US$ 10715.0 million, as against US$ 12037.6 million during the
previous year, marking a decline of around 11 per cent. As per
the latest available WTO data (1998), India’s percentage shares
in the global textiles and clothing trade is 3.47 per cent and
2.41 per cent respectively.
Textile export
target for the year 2002-03 has been fixed at US$ 15,005 million.
In spite of the current export trends, the expected achievement
during 2002-03 will be of the order of US$ 13.0 billion. Textile
exports during the period April-July, 2002 amounted to US$ 3845.8
million as compared to export of US$ 3604.2 million during the
corresponding period of 2001, recording a growth of 6.7 per cent.
Readymade garments
account for approximately 46 per cent of the country’s total textile
exports. During the period April-July 2002, readymade garment
exports were US$ 1608.9 million, recording a growth of 6.7 per
cent over those during the corresponding period of 2001-02. The
major importing countries/regions of the readymade garments are
the European Union, USA, Canada, Japan, UAE and Switzerland. Cotton
textile exports recorded a decline of 13.4 per cent in 2001-02
compared to those of the previous year. However, during the period
April-July, 2002, cotton textiles exports have amounted to US$
1123.1 million recording a growth of 6.3 per cent as compared
to the exports during the corresponding period in 2001-02.
Man-made fibre
textiles exports have marginally declined by 1.1 per cent in 2001-02
as compared to the previous year. But during April-July 2002 man-made
textiles have amounted to US$ 448.0 million recording a growth
of 21.5 per cent as compared to the corresponding period in 2001-02.
Silk textiles exports had declined by 10.8 per cent in 2001-02
as compared to the previous year. However, during the period April-July
2002, silk exports amounted to US$ 134.9 million recording a growth
of 4.7 per cent as compared to the corresponding period in 2001-02.
Woollen textile exports declined by 16.7 per cent in 2001-02 in
US dollar terms as compared to the previous year. During the period
April-July, 2002, wool exports have declined by 27.5 per cent
as compared to the corresponding period of 2001-02.
Handicraft exports
have also declined by 15.4 per cent in 2001-02 as compared to
the previous year. The period April-July, 2002, handicrafts including
carpets exports have exhibited a growth of 3.6 per cent in dollar
terms, as compared to the corresponding period of 2001-02. Coir
exports increased by 27.5 per cent in 2001-02 as compared to the
previous year. During the period April-July, 2002, coir exports
have amounted to US$ 25.0 million showing a decline of 6.2 per
cent as compared to the corresponding period of 2001-02. Jute
exports also had declined by 18.7 per cent in 2001-02 as compared
to the previous year. However, during the period April-July, 2002,
jute exports have amounted to US$ 48.5 million recording a growth
of 14.0 per cent as compared to the corresponding period of 2001-02.
Textile exports
face restrictions in the form of quotas from certain importing
countries like US, EU and Canada. The overall quota and non-quota
exports ratio is approximately 55:45. The major reasons for slow
/ negative growth of textile exports in recent past are the reduced
global demand triggered by the slowdown in the economies of some
of the major trading partners like US, increasing polarization
of world trade, formation of preferential trading blocks and stiff
competition from low cost suppliers like Bangladesh, China, etc.
particularly in the price sensitive range where bulk of the textile
exports are concentrated.
Indian textile exports
faced anti-dumping and other non-tariff barriers from the importing
countries. Presently, the exports of cotton bed linen and polyester
staple fibre to European Union and polyester texturised filament
yarn to Turkey are subject to anti-dumping duties imposed by the
importing countries. Similarly, changes introduced by the USA
in the ‘Rules of Origin’ criterion did affect exports to third
countries like Sri Lanka, members of European Union, etc.
One of the strategies
for reducing the adverse impact of regionalism on the textile
trade is by way of negotiating reduction in MFN tariffs in textiles
of the major trading partners in the post Doha scenario. Certain
leading buyers have been enforcing a code of conduct with reference
to observance of work place norms, labour conditions, environmental
standards etc. for compliance by the manufacturer/exporters. In
order to prepare the industry to face these challenges, Government
has provided a network of testing facilities including for eco-parameters
and initiated new Schemes like Apparel Parks for Exports, Textile
Centres Infrastructure Development Scheme.
