You are here: Home » Companies » Industry
Business Standard

Apparel exports may touch $16.5 billion in 2014-15

The target likely to be missed due to several factors such as lack of adequate sops as well as international market conditions

Vinay Umarji  |  Ahmedabad 

Lack of adequate sops and overall dull market, apparel exports may miss the earlier target of $ 17.25 billion in the country. According to sources, as against the target of $17.25 billion, apparel exports worth $16.50-16.75 billion is being anticipated.

"The target may be missed due to several factors such as lack of adequate sops as well as international market conditions. For instance, the European market has not been so bullish as far as apparel exports from India are concerned," said an Apparel Export Promotion Council (AEPC) official on condition of anonymity.

In the month of February alone, the saw an 8 per cent growth as against the expected 12-15 per cent growth. This is also because exporters reduced capacity to take orders amidst zero interest subvention and other export oriented incentives.

"Europe forms about 48 per cent of India's apparel exports. The has been demanding an FTA with Europe in this regard. Moreover, the industry has also demanded interest subvention but which wasn't announced in the recent budget as well," said A Sakthivel, president of Tirupur Exporters Association.

According to industry experts, as against an inflation of 6-7 per cent in India, inflation in Europe is much lesser. This makes apparel exports unviable since raw material costs in India are rising faster than the finished goods prices in Europe. If and when passed, the FTA will place Indian garment exporters to par with their Bangladeshi counterparts who export apparel duty free to European nations.

What's more, the council is projecting further decline in apparel exports growth in the first quarter of next fiscal. "Unless the government meets some of the demands of the industry, the growth may further decline in the coming quarters," the AEPC official stated.

Buoyed by the previous year's growth and China off-loading its export orders, AEPC had targeted a robust 13-15 per cent growth rate for the second consecutive year i.e. 2014-15.

Indian apparel exports were able to post a healthy growth rate of 15.5 per cent at $14.9 billion in 2013-14 as against $12.9 billion in 2012-13, thanks to revived demands from the US and European markets. At 13-15 per cent, Indian apparel exports were expected to touch $17.25 billion for the year 2014-15.

Globally, on one hand, while China - which, at 36 per cent global share is the largest apparel exporter - is being forced to off-load export orders due to high manufacturing costs and labour shortage, Bangladesh is also facing safety and compliance issues.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Tue, March 17 2015. 20:59 IST