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Stringent labour laws affect exports of textiles & leather

Mar '07
India's labour-intensive exports like Textiles, Garments, Handicrafts and Leather & Leather Products are growing slower than the knowledge and technology-intensive exports, according to an analysis done by FICCI. FICCI's analysis shows that exports of textiles and leather & leather products grew at an average rate of less than 8% per annum for the last five years.

And, in case of Handicrafts, the growth rate has been in fact negative for the same period. Expressing concern over this trend, FICCI's President Mr Habil F Khorakiwala told the Board of Trade “The issue needs to be considered seriously and to generate more employment in the manufacturing sector there is a need to scale-up the export growth rate of such labour-intensive products”.

According to FICCI, the robust growth shown by total exports of India and knowledge/technology-intensive exports is not reflected in the growth of exports in these labour-intensive sectors.

“Even for the current period i.e. April-October 2006 labour-intensive sectors like leather & leather products, gems and jewellery, sports goods, textiles and handicrafts, slower or negative export growth rate was witnessed” Mr Khorakiwala further said.

Not only the growth rate, even the share of these products in our total exports has declined significantly over a period of time, observed FICCI. The share of textiles, a handicraft and leather product was around 28% in 2001-02 which has come down to 18% by 2005-06.

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