In a major sign of revival in the Indian textile industry after three months of sharp downturn, registration for yarn exports shot up by 17.8 per cent in May on renewed demand from the traditional markets, including North America and Western Europe.
Fresh demand from other markets, such as Latin America and some Southeast Asian countries, has also helped this increase in export registrations.
Data compiled by the Directorate General of Foreign Trade (DGFT) showed total registration for cotton yarn shot up to 74.5 million kg in May, against 63.2 mn kg in the corresponding month last year. In the three preceding months ended April, however, total cotton yarn export registration was 60-64 mn kg.
“Even at 74 mn kg, the registration is lower than the monthly average of around 80 mn kg if India has to achieve the annual estimate of 850 mn kg this year. But, the trend has started recovering from the steep decline in global demand of the February-April period,” said D K Nair, secretary-general of the Confederation of Indian Textile Industry.
| GROWING EXPORTS ($ mn) | |||
| Segment | Jan – Apr 2011 | Jan – Apr 2012 | Change (%) |
| A. Apparel | 1,293.20 | 1,206.63 | (-)6.69 |
| B. Non-apparel | 766.96 | 916.15 | 19.45 |
| Yarns | 24.07 | 32.02 | 33.04 |
| Fabrics | 99.62 | 100.69 | 1.07 |
| Made-ups (misc) | 643.27 | 783.45 | 21.79 |
| Total (A+B) | 2,060.16 | 2,122.78 | 3.04 |
| Source : Confederation of Indian Textile Industry | |||
Apart from the revival in demand and those from newer markets as mentioned earlier, textile producers are also making efforts to get a foothold in the Japanese market, which is likely to see some positive result soon, said Nair. Unlike last year, which saw huge volatility in textile demand globally, resulting in turbulent export registration for cotton yarn, the trend looks up this year.
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According to US government figures, their overall textile import rose a marginal three per cent in January–April this year. A major gain has been in the non-apparel sector, which recorded a staggering 19.5 per cent growth to $916 mn in this period, compared to $767 mn in the same period the year before. During the period, US consumers imported 838 million pieces of non-apparel garments from India as against 751 mn in the same period a year before. The US market takes 35 per cent of India’s annual textile exports, worth $8-9 billion. The traditional markets, mainly North America and Western Europe, together take 60-65 per cent of our overall annual textile exports. Hence,revival in demand in these regions is significant for Indian manufacturers.
Apparel export, however, remained under pressure, with overall shipment falling 6.7 per cent in the first four months of this calendar year. “The reason is primarily the slow recovery in the US market. Apparel importers from the US have gradually ramped up imports from India’s competing neighbour, Bangladesh, which apparently offers products cheaper, due to lower labour cost. This is affecting India’s apparel export badly,” said Rahul Mehta, president of the Clothing Manufacturers Association of India.
Neverthless, the revival in textile demand would benefit India, as Bangladesh does not have raw materials. For cotton and cotton yarn, the two major raw materials for cotton textile production, Bangladesh depends heavily on India, said Nair.