The Hindu Business Line : Textile exports up 26 pc in first year of post-quota regime

The trend
Ready made garments clocked a robust growth of 32.42 pc
Cheap Chinese imports hit silk exports
Various policy measures aided growth

New Delhi , April 15

Contrary to the initial pessimism that the end of quota regime governing global trade in textiles and clothing on January 1, 2005 has not produced any dramatic gain to India, textiles and clothing exports from the country clocked 26 per cent growth in dollar terms during 2005-06, the first full year of free trade in textiles.

Latest official figures compiled by the Ministry of Textiles conclusively show that textile exports from India during the penultimate year of the 10th Five-Year Plan (2005-06) fetched a handsome $17,007.52 million, against $13,496.78 million in 2004-05. In rupee terms, textile exports increased to Rs 75,365.52 crore (Rs 60,641.04 crore).

Readymade garments

What is particularly noteworthy is that readymade garments (RMGs), which account for a majority of the textile segment, did exceedingly well in the post-quota regime, clocking a vibrant 32.42 per cent growth to $8,213 million ($6,202 million).

Ministry officials said that export of RMGs to the US and the European Union showed high growth rate last fiscal, taking due advantages of various policy measures initiated by the Government in rationalising the fiscal structure of the industry and dereservation of RMGs, hosiery and knitwear sector, and providing growth impulses for modernisation, capacity expansion and upgradation of technology to meet the competitive pressures of the free trade regime, particularly from low-cost suppliers like China, Pakistan, and Bangladesh, they said.

infrastructure

They added that to provide world-class infrastructure amenities to the textile industry, the Government merged two schemes - the Apparel Parks for Export Scheme (APES) and the Textile Centre Infrastructure Development Scheme (TCIDS) - into a single Scheme for Integrated Textile Parks (SITPs).

This, coupled with extant schemes like Technology Upgradation Fund Scheme and Technology Mission for Cotton and Jute, would help broadbase the export incentives available to the industry to make a sustained foray into the external markets.

Export of special women's fabric from India notched up a robust 18.31 per cent growth to $130.81 million ($110.57 million).

Carpet exports were another growth area, registering 36 per cent growth to $1,057.05 million ($777.51 million).

While exports of wool and woollen items posted a growth of 12.72 per cent to $76.50 million ($67.87 million), exports of silk items marked a moderate growth of 8.24 per cent to $383.35 million ($354.15 million).

The growth of silk exports would have been a shade better had the domestic silk industry not been compelled to contend with cheap imports from China distorting cost calculation.

Synthetics segment

The Indian industry's performance in man-made filaments and staple fibre segments has not been quite encouraging (the world trade in textiles and clothing is largely based on synthetics).

Man-made filaments exports were down at $871.47 million ($949.30 million), while export of man-made staple fibre logged 4.11 per cent growth to $783.11 million ($752.21 million).

However, the performance of other made-up textile articles notched up 25.63 per cent growth to $2,309.82 million ($1,838.59 million).

In cotton exports, where India has a competitive advantage by being the major producer, the growth was 33.35 per cent to $2,822.14 million in 2005-06, compared to $2,116.33 million earlier.

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