The Hindu Business Line : Sports goods exporters feeling left out, seek fair play

New Delhi, Dec. 30 Sports goods exporters are crying foul for having been left out of the list of labour-intensive sectors to benefit from a special fiscal package.

The industry is one of the most labour-intensive and has been just as affected by the recession, says Mr Tarun Dewan, Secretary, Sports Goods Export Promotion Council.

Importers, unsure of Christmas sales, have already asked for their shipments to be postponed by two months. There’s uncertainty on the number of new orders expected after season’s sales. Sports subsidies in colleges and universities abroad could be the first to be sacrificed in a recession, say exporters. Brands such as Puma, Kookaburra, Slazenger, Gunn & Moore and Miter source their products from India.

Cricket gear maker Sanspareils Greenlands had a turnover of Rs 30 crore this year, but expects a 20 per cent drop next year. With no forward orders, February and March look bleak, says the Chairman and Managing Director, Mr K.C. Anand. “The orders we have received are smaller than last year, and there have also been a few cancellations,” he says.

Tight money

“Since November, orders have fallen by 30-40 per cent, says Mr Vikas K. Gupta, Managing Director of the Jalandhar-based Soccer International. Mr Gupta says companies such as his, exporting 2.5 million footballs a year, are now forced to move towards automation to compete with cheaper Chinese machine stitched balls. “Banks, however, are too tight, and finances are not easily available,” says Mr Gupta.

Exchange rate hurdle

Ranson Sports Industry’s Mr R.S. Rana, who also serves as the Chairman of Sports Goods Manufacturers and Exporters Association of Jalandhar, adds that exchange rates also place them at a disadvantage. (UK is the biggest importer having bought goods worth Rs 155 crore in 2007-08, almost twice as much the second largest importer, Australia.)

“Importers insist on paying in pounds for orders taken in June-July. The pound, which then cost around Rs 85, was down to Rs 70 by September,” says Mr Rana. Raw material imports, on the other hand, are billed in dollars. Costs of polyurethane, PVC and latex had risen by as much as 30-40 per cent at one time. The Australian dollar has fallen from Rs 37 to Rs 32. The price of British Willow, used for bats, has also been rising at 20-30 per cent over the last few years.

“A gripping Ashes series, like the one two years ago, should provide some impetus and would be a consolation,” says SG’s Mr Anand.

Job scene

According to the Council, 2 lakh people and another 3 lakh employed indirectly work in the two major manufacturing centres of Jalandhar (Punjab) and Meerut (Uttar Pradesh). The Meerut-based SG, which employs 900 people, says the workers, paid per piece, are taking home Rs 7,000 a month, compared to the Rs 1,000-1,200 they made a few months earlier.

The earlier fiscal package extended a 2 per cent interest support to exporters of textiles, leather, handicraft, gems and jewellery and carpets. Sports goods exporters would like to be considered for the concession, and are hoping to meet the Commerce and Industry Minister, Mr Kamal Nath.

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