India’s textile and apparel exports may be difficult to achieve expected targets
Indian officials recently stated that although the Indian rupee has continued to depreciate since the 2011-2012 fiscal year, due to the sovereign debt crisis, demand in Europe, India’s largest market, has shrunk. Therefore, India’s textile and apparel exports may not reach the US$33 billion target.
Nair, president of the Federation of Indian Textile Industry, said earlier that in 2011-2012, India’s textile and apparel exports may reach US$33 billion. Due to the depreciation of the rupee, exports are only one step away from the target. However, judging from the export situation in recent months, it is still difficult to achieve this goal.
Due to the intensification of the European debt crisis, in February this year, India’s clothing exports were US$1.28 billion, an increase of only 1.5%. In addition to external factors, domestic yarn prices fell after India’s domestic textile mills bought cotton, the main raw material, at high prices, making domestic sales of Indian cotton mills unprofitable. They are also unable to export their products due to weak domestic demand and restrictions on exports, resulting in huge losses.
Although the U.S. market has recovered slightly, the macroeconomic crisis in Europe is still worrying. While Indian exporters are trying to boost sales to new markets to reduce risks, no substantial breakthrough has been made so far. As India’s two major export markets, the EU and the United States account for approximately 65% of India’s total textile exports.
Statistics show that the textile industry accounts for about 14% of India’s gross industrial production and more than 10% of the country’s total exports. The textile industry is the industry that creates the largest employment opportunities after agriculture, with approximately 35 million people employed in various aspects. In the fiscal year 2010~2011, India’s textile and apparel exports were US$26.8 billion.
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