Apparel exporters eye non-traditional markets like Russia, Mexico & South Africa

Facing tough competition from countries like Vietnam and Bangladesh in US and European markets, Indian apparel exporters have started venturing into non-traditional markets like Russia, Mexico, South Africa, Australia and West Asia. The plan is to increase exports to non-traditional markets from 24% to 35% within the next few years.

Apparel exports from India to the US slumped 10.6% this year up to July to $1.94 billion, according to data given by the Office of Textiles and Apparel, US. While apparel exports from China and Bangladesh, the major competitors to Indian textile firms, were almost flat, exports from Vietnam clocked a 9% growth.

Talking to ET, Apparel Exports Promotion Council (AEPC) chairman A Sakthivel said: "Our aim is to increase the share of exports to non-traditional markets from 24% to 35%. If this happens, the share of exports to EU would comedown to around 40%."

Tirupur, the country's hub of garment exports, has shipped garments worth around Rs 6,000 crore in the first six months of the current fiscal, which isalmost the same compared to the previous year.

Tirupur generally exports garments worth nearly Rs 12,500 crore and industry officials say the figure has remained almost stagnant in last three years.

DK Nair, secretary general of Confederation of Indian Textile Industry, said: "While there is a need to reduce dependence on traditional markets like the US and Europe for exports, Indian apparel manufacturers should also work hard to increase productivity and reduce cost to remain competitive." He added that the US market is recovering slowly which is good news for the Indian apparel industry.

AEPC has been organising buyer-seller meets across the world to tap opportunities in newer markets.

Indian exporters have visited Japan, Russia, Israel, South Africa, Norway, Sweden and Denmark in the past few months.

"It is not easy to penetrate these markets but there are positive signs," said Sakthivel. The government has set a target of $18 billion for apparel exports during the current financial year, However, Nair said the target seemed hard to achieve as European markets are yet to recover from a recession.

Ludhiana-based ready-made garment exporter Deepak Dumra said merchandise for high-street markets has a reasonably good demand compared to garments manufactured for masses. "We are now working for the next summer and orders are coming at a reasonable pace. One has to be price-competitive to survive," said Dumra whose company Greatway manufactures cotton knit and woollen sweaters, under-garments and shirts.

This article was originally published in the Economic Times dated 25^th October, 2012, written by Sutanuka Ghosal and Madhvi Sally, associated with the Economic Times Bureau, Kolkata & Ahmedabad, respectively.