Export Performance Of Indian Textile Industry - A Sector Study

Introduction

International trade

International trade is the exchange of goods and services across international boundaries or territories. In most countries, it represents a significant share of GDP. While international trade has been present throughout much of history (see Silk Road, Amber Road), its economic, social, and political importance has been on the rise in recent centuries. Industrialization, advanced transportation, globalization, multinational corporations, and outsourcing are all having a major impact. Increasing international trade is the primary meaning of "globalization".

Export

In economics, an export is any good or commodity, transported from one country to another country in a legitimate fashion, typically for use in trade. Export is an important part of international trade. Its counterpart is import.

Export goods or services are provided to foreign consumers by domestic producers. Export of commercial quantities of goods normally requires involvement of the Customs authorities in both the country of export and the country of import.

The advent of small trades over the internet such as through Amazon, e-Bay and the like, have largely by-passed the involvement of Customs in many countries due to the low individual values of these trades. Nonetheless these small exports are still subject to legal restrictions applied by the country of export, particularly in respect of strategic export limitations.

Import

In economics, an import is any good or commodity, brought into one country from another country in a legitimate fashion, typically for use in trade. Import goods or services are provided to domestic consumers by foreign producers. Import of commercial quantities of goods normally requires involvement of the Customs authorities in both the country of import and the country of export.

The Textile industry is a term used for industries primarily concerned with the design or manufacture of clothing as well as the distribution and use of textiles .The textile industry occupies a unique place in our country. One of the earliest to come into existence in India, it accounts for 14% of the total Industrial production, contributes to nearly 30% of the total exports and is the second largest employment generator after agriculture.

The textile industry fulfils a pivotal role in the Indian economy. It is a major foreign exchange earner and, after agriculture, it is the largest employer with a total workforce of 35 mn. In 2005 textiles and garments accounted for about 14 per cent of industrial production and 16 per cent of export earnings. The industry covers a wide range of activities. These include the production of natural raw materials such as cotton, jute, silk and wool, as well as synthetic filament and spun yarn. In addition, an extensive range of finished products are also made. The Indian textile industry accounts for about 23 per cent of the world's spindle capacity, making it the second highest after China, and around six per cent of global rotor capacity. Also, it has the highest loom capacity including hand looms with a 61 per cent share. India accounts for about 12 per cent of the world's production of textile fibers and yarns. This includes jute, of which it is the largest producer.

Textile Industry is providing one of the most basic needs of people and the holds importance; maintaining sustained growth for improving quality of life. It has a unique position as a self-reliant industry, from the production of raw materials to the delivery of finished products, with substantial value-addition at each stage of processing; it is a major contribution to the country's economy. Its vast potential for creation of employment opportunities in the agricultural, industrial, organized and decentralized sectors & rural and urban areas, particularly for women and the disadvantaged is noteworthy. Although the development of textile sector was earlier taking place in terms of general policies, in recognition of the importance of this sector, for the first time a separate Policy Statement was made in 1985 in regard to development of textile sector. The textile policy of 2000 aims at achieving the target of textile and apparel exports of US $ 50 billion by 2010 of which the share of garments will be US $ 25 billion. The main markets for Indian textiles and apparels are USA, UAE, UK, Germany, France, Italy, Russia, Canada, Bangladesh and Japan. The industry expects investment of Rs.1, 40,000 crore in this sector in the post-MFA phase. A Vision 2010 for textiles formulated by the government after intensive interaction with the industry and Export Promotion Councils to capitalize on the upbeat mood aims to increase India's share in world's textile trade from the current 4% to 8% by 2010 and to achieve export value of US $ 50 billion by 2010.

Export Promotion Councils

The government of India concentrates in export of textile products; government provides lot of necessary helps to the textile industry through the following export promotion councils.

1.Handloom Export Promotion Council (HEPC)

The council gets grant-in-aid from Government for its export promotion activities like organization of fairs/ exhibitions/ seminars/ buyer seller meets etc. It is the nodal agency for promotion of exports of the handloom sector.

2.Apparel Export Promotion Council (AEPC)

Objective of the Council is to promote, advance, increase and develop exports of all types of ready made garments. Woolen knitwear and garments of leather, jute and hemp are excluded from its purview.

3.Cotton Textile Export Promotion Council (TEXPROCIL)

The Council looks after the export promotion of cotton fabrics, cotton yarn and cotton made-ups. Its activities include market studies for individual products, circulation of trade enquiries, participation in exhibitions, fairs and seminars at home and abroad, in order to boost exports.

4.The Synthetic and Rayon Textile Export Promotion Council (SRTEPC)

It is the nodal agency for promotion of exports of Indian synthetic and rayon textiles (yarn, fabrics and made-ups).The council gets grant-in-aid from Government for its export promotion activities like organization of fairs/ exhibitions/ seminars/ buyer seller meets etc.

5.Indian Silk Export Promotion Council (ISEPC)

The ISEPC is the nodal agency for promotion of exports of natural silk goods from India and acts as a registering authority for the information to its members. The council produces and disseminates information to its members about the market developments in the world, changes in the trade polices, etc. A catalogue containing sample swatches of the full range of silks from India is available for potential buyers, importing textiles agents and Indian missions abroad.

6.Wool and Woolens Export Promotion Council (W&WEPC)

The council's objective is promotion of exports of Wool and Woolen products. The council gets grant-in-aid from Government for its export promotion activities like organization of fairs/ exhibitions/ seminars/ buyer seller meets etc.

7.Carpet Export Promotion Council (CEPC)

The council's objective is promotion of exports of carpets. The council gets grant-in-aid from Government for its export promotion activities like organization of fairs/ exhibitions/ seminars/ buyer seller meets etc.

8.Export Promotion Council for Handicrafts (EPCH)

The council's objective is promotion of exports of handicrafts products. The council gets grant-in-aid from Government for its export promotion activities like organization of fairs/ exhibitions/ seminars/ buyer seller meets etc

9.Power loom Development & Export Promotion Council(PDEXCIL)

Power loom Development & Export Promotion Council is a nodal agency for development and promotion of the exports of Power loom products.

Table No 1 shows that the export details about the textile industry, in that table we have 8 number of sectors namely Cotton Textiles, Manmade Textiles, Silk, Wool, Ready Made Garments, Handicrafts, Jute and Coir & Coir Manufactures. Based on this data table, after some analysis we have the sector wise analysis report. That report whispered the followings.

SECTOR-WISE ANALYSIS

(i) Cotton Textiles including Handlooms:

Cotton Textiles i.e. yarn, fabrics and made-ups (Mill made / Power loom/ Handloom) constitute more than 2/3rd of our exports of all fibers/yarns/made-ups. During 2004 2005, Cotton Textile exports including Handlooms were US$ 3.54 billion, recording a decline of 1.5% as compared to the corresponding period of 2003-04. During 2005-2006 the Cotton Textiles exports have amounted to US$ 4.49 billion, recording a healthy increase of 26.78% over the exports during the corresponding period of 2004-2005. During the first quarter of 2006-2007 the Cotton Textiles including Handlooms exports have amounted to US$ 1.25 billion, recording an increase of 25.70% over the exports during the corresponding period of 2005-2006.

(ii) Man-made Textiles:

During 2004 2005, man-made Textiles exports were US$ 2.05 billion, recording a growth of 12.6% as compared to the corresponding period of 2003-04. During 2005-2006 the man-made Textile exports have amounted to US$ 2.00 billion, recording a decline of 2.47% over the exports during the corresponding period of 2004-2005. During the first quarter of 2006-2007 the Man-made Textiles exports have amounted to US$ 0.52 billion, recording an increase of 13.15% over the exports during the corresponding period of 2005-2006.

(iii) Silk Textiles:

During 2004 2005, Silk Textiles exports were US$ 0.59 billion, recording a growth of 9.0% as compared to the corresponding period of 2003-04. During 2005-2006 the silk exports have amounted to US$ 0.69 billion, recording an increase of 16.37% over the exports during the corresponding period of 2004-2005. During the first quarter of 2006-2007 the Silk Textiles exports have amounted to US$ 0.165 billion, recording an increase of 4.23% over the exports during the corresponding period of 2005-2006

(iv) Woolen Textiles:

During 2004 2005, woolen Textiles exports were US$ 0.42 billion, recording a growth of 23.4% as compared to the corresponding period of 2003- 04. During the period of April-March, 2005-2006 the woolen Textile exports have amounted to US$ 0.47 billion, recording an increase 13.63% over the exports during the corresponding period of 2004-2005. During the first quarter of 2006-2007 the Woolen Textiles exports have amounted to US$ 0.114 billion, recording an increase of 11.96% over the exports during the corresponding period of 2005-2006.

(v)Readymade Garments:

Readymade Garments account for approximately 45% of the countrys total textiles exports. During the year 2004 2005, Readymade Garment exports were US$ 6 billion, recording an increase of 4.1% as compared to the corresponding period of 2003-04. During 2005-2006 the Readymade Garment exports have amounted to US$ 7.75 billion, recording an increase of 28.69 % over the exports during 2004-2005. During the first quarter of 2006-2007 the Readymade Garment exports have amounted to US$ 2.17 billion, recording an increase of 15.70% over the exports during the corresponding period of 2005-2006.

(vi) Handicrafts including Carpets:

During 2004 2005, handicrafts including carpet exports were US$ 1.01 billion, showing a decline of 6.6% as compared to the corresponding period of 2003-04. During 2005-2006 the handicrafts exports have amounted to US$ 1.24 billion, recording an increase of 22.24% over the exports during 2004-2005. During the first quarter of 2006-2007 the Handicrafts including Carpets exports have amounted to US$ 0.301 billion, recording a marginal decline of 1.31% over the exports during the corresponding period of 2005-2006.

(vii) Jute:

During 2004 2005, jute exports were US$ 0.276 billion, recording a growth of 14% as compared to the corresponding period of 2003-04. During 2005-2006 the Jute exports have amounted to US$ 0.295 billion, recording an increase of 6.64% over the exports during the corresponding period of 2004-2005. During the first quarter of 2006-2007 the Jute exports have amounted to US$ 0.065 billion, recording a decline of 7.79 % over the exports during the corresponding period of 2005-2006.

(viii) Coir:

During 2004 2005, coir exports were US$ 0.106 billion, recording a growth of 35.7% as compared to the corresponding period of 2003-04. During 2005-2006 the coir exports have amounted to US$ 0.134 billion recording an increase of 27.19% over the exports during 2004-2005. During the first quarter of 2006-2007 the Coir exports have amounted to US$ 0.032 billion, recording an increase of 10.03% over the exports during the corresponding period of 2005-2006.

Conclusion

To conclude this article, the textile industry, which is the industry earning the highest income of our country after agricultural. The textile industrys export performance is going well as per the study based on the data shown in the Directorate General of Commercial Intelligence and Statistics (DGCIS). That is the export of textile products is budding year by year. Numerically say, in the year 2002-03 export of textile products was Rs.60071.70 crs and its climb up to Rs 62017.2 crs in the year 2003-04, and it reached Rs 63024.18 crs in the year 2004-05.