Apparel exporters wait for Santa Claus.

Bangalore, July 2 Apparel exporters, deeply impacted by the meltdown in the global economy, are hoping for a turnaround during Christmas.

The industry, which was battered some months ago, is in stabilisation mode and is getting used to the reality that growth will be slow and not spectacular, even as it looks forward to July 6 for Budget sops.

Says Mr Rajendra Hinduja, Managing Director, Gokaldas Exports, “Things will take six-seven months to pick up. But they are not deteriorating — that’s a healthy sign. While in India the economy is looking up, the American and European markets are still not feeling the trigger. A turnaround is expected there around Christmas time.”

Indian textile and clothing exports during April-December $15.27 billion — a mere 0.12 per cent rise from $15.25 billion in the same period the previous financial year. US imports of textile and clothing in calendar year 2008 dipped 3.34 per cent from around the world. Imports from India dipped by 0.55 per cent. But the industry hopes to catch up once the markets improve significantly. “If the economy improves, people will feel good. Also, while people may cut down on luxury items and holidays, they have to buy clothes,” says Mr Hinduja.

What is reassuring is that buyers abroad are in touch with Indian exporters and talking to them. “Buyers are saying that secondary sales — that is at the retail front — are slowly firming up,” says Mr R. Sivaram, Executive Director, Royal Classic Group.

Buying is expected to peak during Christmas — the holiday and festival period is generally the time when maximum buying takes place in the Western markets. Industry sources estimate that this season contributes around 35-40 per cent of yearly sales.
Consumer confidence

The global economy may not bounce back to pre-recession highs, at least not by December, but the hope is that consumer confidence will improve, even if volumes remain low.

Mr V. Thiagaraj, Executive Director, Sona Valliappa Textiles, says, “The market has bottomed out; it will have to move forward from here. The purchasing will take some time to happen. Things will certainly start moving from the beginning of winter. September onwards, buying should improve, touching the peak by Christmas, which is when sentiments would have changed a lot more positive than today. But all this depends on buying power; confidence needs to set in, this may even be faster in some countries. But I am not sure of large volumes compared to the previous years.”

Source : Business Line