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Tuesday, Oct 19, 2004

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Industry & Economy - Readymade Garments

Apparel exports up 16% in first half

G. Srinivasan

New Delhi , Oct. 18

READYMADE garment (RMG) exports from the country to quota-restricted countries registered a 16 per cent growth in value terms and 10 per cent in volume terms during the first half of the current fiscal, spurring hope that the year will see export receipts from this segment touching $5.5 billion-$5.7 billion.

Figures compiled by the Apparel Export promotion Council (AEPC) reveal that exports of RMGs to quota-restricted countries during April-September 2004-05 amounted to 590.3 million pieces valued at $2505.6 million, logging a growth of 9.64 per cent in volume and 15.77 per cent in terms of value, compared to the corresponding period the previous fiscal.

The AEPC Chairman, Mr A. Sakthivel, told Business Line here that since the quota system was in any case going by the end of this year, there might be a rush to source more from India, especially by retail giants abroad. However, he expressed dismay over the recent cut in DEPB (Duty Entitlement Passbook scheme) rates and sought the Government's intervention not to reduce drawback rates as both could upset the industry's calculations.

He also said that though the exporters would get reimbursement for the new service tax and the cess on education, exporters should not be subject to paperwork on this score by exempting them from these new levies.

Mr Sakthivel said the Indian textile and clothing industry had invested heavily in the run-up to the end of the quota regime to cash in on the opportunities once the global trade in textiles and clothing gets governed by the WTO rules of free and fair trade from January 1, 2005.

During the first half of the current fiscal, exports to the US amounted to 229.3 million pieces valued at $1,175.6 million, representing an increase of 22.88 per cent in terms of volume and 21.81 per cent in terms of value, compared to April-September 2003-04.

Since the US remains by far the single biggest market for Indian textile products, the double-digit volume and value growth in this segment heralds hope for an optimistic outlook for the rest of this fiscal, particularly in the ensuing festival season towards the end of the year, industry sources say.

Exports of RMGs to the European Union countries during the period under review amounted to 335.2 million pieces valued at $1,243.3 million, a 4 per cent increase in volume and 12 per cent rise in terms of value.

Exports to Canada during April-September 2004 amounted to 25.8 million pieces valued at $86.6 million, showing a decrease of 4.4 per cent in volume and 2.04 per cent in terms of value.

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