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Indian apparel exporters to face new competition
06
Jan '12
Along with the changing global scenario, India apparel exporters may not have to face competition from China, but from three other countries – Bangladesh, Vietnam and Indonesia, according to experts.

The three Asian countries are more efficient and cost competitive in apparel production and Indian apparel exporters run the risk of losing their market share to these countries, they warn.

“Global prices of textile products including apparel have declined and demand also continues to decrease, mainly due to the slowdown in the economies of large importing countries in the West. In such a situation, competition to Indian garment exporters arises from countries like Bangladesh, Vietnam and Indonesia, which are more efficient and cost competitive in apparel production,” Mr. DK Nair, Secretary General of the Confederation of Indian Textile Industry (CITI), told fibre2fashion.

“As of now, we run the risk of losing our market share to these three countries. Contrary to the general perception, China may not be our major competitor in global markets in the coming years because of their internal problems,” he adds.

“In design, quality and other aspects, Indian apparels can effectively meet competition from any country. However, price competitiveness will be the principal determining factor in bagging export orders,” he opines.

Talking about the performance of Indian apparel exports in 2011, he says, “In value terms, there was no decline in our exports of garments during 2011. However, in USA, which is our largest single market for garments, there was a decline of 4.91 percent y-o-y in terms of quantity during January-October 2011. However, there was an increase of 8.95 percent y-o-y in value terms, which was basically due to increase in raw material cost. Therefore, exporters actually lost money.”

“The trend in other major markets has been the same. In European Union, which collectively is a larger importer than the USA, the situation is even worse because of the economic problems that West Europe is currently going through. The USA and the EU together account for over 60 percent of our total garment exports,” he adds.

Commenting about the changing market of Indian apparel exports, Mr. Hari Kapoor, Vice Chairman, Apparel Export Promotion Council (AEPC), says, “Some new countries have started emerging in the market. Our constant and largest buyers were the US and Europe in the beginning, but now some more countries which were not big importers of Indian apparels are becoming important.”

“Apparel exports are increasing to countries like UAE and Russia. Similarly the South American corridor is beginning to improve in quality and size of the business. Business is increasing in Brazil, Argentina, Mexico, etc. We also see a beginning of trade between India and China, as some quantities of garments are being imported by China from India,” he adds.

Sounding optimistic for 2012, he says,“I expect apparel exports to China to be much larger this year. However, the nature of garments exported to China will not be basic garments; it will be more value-added and more fashion items. So, Indian apparel exports will definitely have a good situation in a market like China.”

Fibre2fashion News Desk - India


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