Describing India’s current textile export trends as not very encouraging, The Cotton Textile Export Promotion Council (Texprocil) Chairman R K Dalmia has called for interest rates subvention for India’s cotton textile industry and a re-calibration of product market matrix to include exports to emerging markets to take on competitors whose exports to developed markets are growing because of preferential access.
At the All India Exporters’ Chamber’s Platinum Jubilee celebration in Mumbai, Dalmia said, “Exports of cotton textiles during April-August 2015 declined by 2.16 per cent at $ 4.24 billion as compared to same period of the last year. The declining exports trend may continue in FY16 due to subdued China demand and sluggish European economy,”
India’s exports of cotton textiles in August 2015 registered a decline of 7.39 per cent to $ 863.18 million as against $ 932.02 million in the same month last year.
“A large part of the reason for the sluggish growth lies in the overall slowing of demand in the overseas markets too. Apart from a general decline in overseas demand, our over-dependence on China especially for cotton and cotton yarn exports, is magnifying the overall decline in our exports as China slows down ,” Dalmia said.
While a slowdown in exports widens the gap in trade deficit in this sector, surplus capacity finds an outlet only through the channel of exports. Dalmia said the government must accelerate efforts to enhance the competitiveness of India’s exports and expedite conclusion of FTAs with the EU, Australia and Canada.
He also pointed out the high cost of export finance which is around 10 per cent in India as compared to 3-4 per cent in competing countries like Vietnam, Bangladesh and Pakistan has also adversely impact India’s textile exports. (SH)