'Apparel exports to fall short by 24%' - Mr Vaid, AEPC

07 Jan '09

4 min read

Apparel exports from India have fallen sharply since August 2008 due to declining sales in the United States and the European Union while those from Bangladesh, Indonesia and Vietnam are on an upswing.

Apparel Export Promotion Council (AEPC), today hosted a press conference to discuss the status of clothing industry in the face of global economic recession. The conference was presided over by chiefs of major industry associations like the Clothing Manufacturers Association of India (CMAI), Garment Exporters Association (GEA), Apparel Exporters and Manufacturers Association (AEMA) and Tirupur Exporters Association (TEA). Among those present were AEPC Chairman Rakesh Vaid, AEPC Executive committee member Hari Kapoor, CMAI President Rahul Mehta, GEA President G.S. Madan and TEA President A. Sakthivel.

All of them called for revisions in the current stimulus packages announced by the government. Fresh data from the Apparel Export Promotion Council (AEPC) shows that apparel exports plunged 11.29 per cent in November to 621 million dollars compared to 700 million dollars in the same period of 2007. Thus the period between April to November shows a decline of 0.2 per cent in exports compared to corresponding period of previous year.

"Apparel exports are likely to fall 24 per cent short of the 11.62 billion dollar target in the current financial year and may total up to 8.78 billion dollars," said Mr Vaid. In 07-08, the country exported garments worth 9.69 billion dollars, nine per cent more than in previous year.

“India is clearly losing its edge in global markets. The government and the industry must gear up to retain existing buying nations and explore fresh markets," he said. Mr Vaid said the global economic recession has led to customers like Steeve and Barry's along with Mervyns filing for bankruptcy. Buyers like Pacific Swimwear, Lane Bryant, Fashion Bug and Catherines have closed hundreds of stores due to sliding sales.

As a result, he added, nearly 500,000 Indian workers have already lost their livelihood in the apparel sector while more job losses are expected in the next three months. "Surveys conducted in export hubs of Gurgaon and Okhla here towards December-end show 84 per cent manufacturing units registered fall in export orders and employment in the range of 20 to 80 per cent," said Mr Vaid.

India's exports to the United States, which imported garments worth 85 billion dollars in calendar 2007, tumbled 11 per cent in rupee terms during October to December last year. But apparel exports to the United States from Vietnam jumped 35 per cent in dollar terms while those from Indonesia were up 8.44 per cent. Even exports from Bangladesh were up 6.6 per cent.

Similarly, India's garment exports to the European Union during January to August stagnated while those of China increased by 8.19 per cent, Vietnam by 9.85 per cent and Bangladesh by 3.01 per cent. Mr Vaid said India's exports and its market share globally are on the decline. Due to better policy support by other countries, India is losing its advantage.

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