Knitwear industry on recovery path; exports sustained at Rs 11,500 cr in FY10.

Estimates by Tirupur Exporters' Association (TEA) show that exports were maintained at Rs 11,500 crore during 2009-10. It is expected to record 10% this year.

Speaking to media persons on the eve of the 30th India Knit Fair being held at Tirupur from April 20 to 23, TEA resident A Sakthivel said, "While we were growing at 15% to 20% since 1984, the last three financial years saw exports dropping from Rs 11,000 crore in 2006-07 to Rs 9,950 crore in 2007-08".

There was good recovery in 2008-09, when it touched around Rs 11,500 crore. In his view, exports would have reached Rs 19,000 crore by now, if it had not faced some unexpected problems.

Sakthivel, who is also the president of Federation of Indian Export organisations (FIEO) "We have also requested the government to allow a fixed rate of conversion at Rs 47.50 per dollar for exporters during the period April 2010 to March 2011, so that those who prefer this option can do the business on a safe platform," he added.

Regarding rising yarn prices, he said that recent announcements by the government to curb cotton and yarn exports should benefit the garment industry.

He said that the withdrawal of DEPB and duty on cotton and cotton yarn exports might bring down the yarn cost by Rs 12 per kg and it will force spinning mills to sell in the domestic market. "If the cotton yarn prices came down, we can look to 10% growth in the knitwear industry this fiscal," he added.

Eastman Exports MD N Chandran told ET that the high cost of yarn has hit vertically integrated players like his group. "Our mills cater to only 50% of our needs and the balance raw material is sourced from outside. So, the sudden hike in cotton yarn prices has affected us badly Mr Sakthivel said the industry is also pursuing its plan to manufacture knitwear garments using manmade fibers. This will help the units to cater to the world market through out the year instead of the few summer months.

"We don't have knitting and processing machines to produce such garments. We have submitted a project to the government for importing machines at a cost of Rs 22 crore through the Knitwear Technology Mission," he added.

TEA has produced few garments using manmade fabrics and they would be displayed during a fashion show organised as part of 30th India Knit Fair in Tirupur on April 20. Apparel Export Promotion Council and India Knit Fair Association will conduct the annual fair, which will showcase products for the spring/summer collection 2011 from April 21-23. As part of the fair, a young entrepreneurs' meet and an exporters' meet will also be held on April 20.

Source : The Economic Times