Apparel sector in India is now showing positive signs of growth during 2010-11. Apparel exporters seekspecial considerations as the sector adds exceptional value to export revenuegeneration. They expect the Government to encourage large scale investment andtake initiatives to minimize production, and transaction costs. They also seekGovernment action in emphasizing price stability in the domestic sector.
During the period of post-quota,apparel exports remained far below the potential. Increasing input costs, highinterest rates, liquidity crunch, high power, and transportation costs, poorinfrastructure are a few of the constraints faced by the apparel exporters. Then,the depressing period of recession increased global competition, and reducedthe demand for apparels. The infected economy in US, EU, and Japan which contributed to almost 80% of the global exports, affected the global market,thus deteriorating the apparel exports of major countries. The recent trek incotton yarn and fabric prices has also affected the apparel exports to aconsiderable extent.
Apparel exports during 2009-10accounted to $9.7 billion. This is 11.4% lower than the previous years figureswhich were $10.95 billion. But exporters still express their optimism that,apparel business would expand by 10% by 2010-11. They anticipate the Governmentto take steps to curtail raw material exports such as cotton and yarn, so as toaugment the domestic industry. Raw material accounts for 50-60% of the totalcost. Due to large-scale exports there was a drastic increase of almost 40-50%in their prices, particularly during the recent months.
Mr. Rakesh Vaid, President of GarmentsExporters Association believes that Indian apparel sector is pivotal to thecountrys economic development by offering job opportunities to the weakersections, and women. This is a dynamic section in the Indian industrial sectorshowing significant progress over the years in terms of cost reduction,standardization, and quality up-gradation. He observes that despite the signsof improvement, economy remains bleak due to the domestic inflationarypressure. As Indian apparel sector consumes 95% of the indigenous materials,adding special value to the exports, it needs special consideration. Hesuggests the Government to introduce labor norms specific to garmentmanufacturers and exporters, thus augmenting to cope with the cut-throatcompetition.
The Textile Ministry has come upwith positive initiatives, aiding the apparel exporters to overcome globalrecessionary effects, and soaring yarn, and fabric prices. With the aid of thefibre policy, apparel exporters are encouraged to do business with overseasmarket with an assortment of garments made from new fibres, and fabrics.
Though US and EU markets are showingsigns of recovery, garment exports were down during 2009, when compared withthe corresponding period of the previous year. Indian garment exporters seeknew markets like Latin America, Middle East, Japan, and Australia. But the new markets are relatively small when compared with the well establishedUS and EU markets.
The increasing interaction ofdomestic economies with other global countries; generally termed asglobalization, is reflected in the rising share of international trade. Clothingexports are increasing in a faster pace than any other trade product. Increasedfocus and appropriate incentives could make the Indian apparel sector outshineits competitors in the global market.
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