Indian garment exports fall 2.6%.

Garment exports from India dropped 2.6% to $10.64bn in 2009/10 compared with $10.93bn in the previous financial year, according to data from the Apparel Export Promotion Council (AEPC).

In rupee terms, however, there was a negligible recovery of 0.4%, with apparel exports totaling Rs 50,479 crore in 2009/10 compared with Rs 50,293 crore in 2008/09. The data showed that all months of 2009/10 except July, August and November showed a decline.

AEPC’s chairman Premal Udani said: “Exporters are in deep trouble as the garment industry is reeling under unprecedented price hikes of yarns and fabrics. The past four months have witnessed a mind-boggling 50 to 80% increase in prices of basic raw materials. Just when there were signs of initial recovery, the industry has been plunged into a gloom because of high raw material prices and their erratic supply.”

Udani asked the government to impose a 15% tax on exports of cotton yarn. He said: “At a time when domestic demand for fabrics and yarns is booming, free exports of basic raw materials like cotton and cotton yarn take millions of jobs away from the country.

He urged the government to have long-term calibrated exports of cotton and yarn and said as far as possible, exports of raw materials should be discouraged. “The government needs to encourage the readymade garment sector which not only earns more foreign exchange per kg of exports but creates millions of jobs in the process.”

Udani also appealed for removal of 16% duty on imports of yarns. Over and above the raw material costs, he said, the industry has been impacted by high labour costs, non-refund of central and state levies besides infrastructure deficiencies.

“Our share in the world market of clothing is going down,” said Udani. “Bangladesh has become a larger garment exporter than India. By next year, Vietnam will also overtake us.”
The Indian apparel industry is the second largest employer of human resources after agriculture.  Udani said immediate government intervention was necessary as millions of jobs are at stake.

Source :- inteletex.com/News