Textiles & jewelry sector may fall short of export target
18 Apr '07
2 min read
Commerce and industry Minister Kamal Nath is expected to release yearly supplement to the foreign trade policy for the current fiscal, tomorrow.
Sources say that the Minister is likely to announce an export target of US $150 billion at a growth of over 20 percent.
Maximum pressure will be on textile and gems and jewelry industry that usually have a significant contribution to the exports.
However, with sluggish US market and increasing value of Rupee the sectors may not be able to achieve the set targets. This giant market absorbs over 35 percent of India's textile exports.
Textiles and related products, including handicrafts, account for nearly one-fifth of the total exports. Sector is likely to record a climb of 20 percent for the 2006-2007 fiscal but the growth-rate is expected to slide to only 10 percent for 2007-2008 period.
Projected exports for gems & jewellery sector stand at $17.2 billion for the current fiscal, almost $1 billion short of the target and registering a rise of only 16 percent. This sector attracts more than 15 percent of the total export orders.
Sanjay Kothari, Chairman, Gems & Jewellery Export Promotion Council (GJEPC) stated, “Rupee appreciation is hurting us. We will not be able to meet this year's target of $18 billion. If the conditions continue like it is today, the commerce ministry's reported export target of $150 billion seems to be wishful thinking, unless it comes out with some schemes toneutralize losses incurred.”
Leather industry earned $3 billion in 2006-2007 fiscal over the targeted $2.9 billion and is now aiming for $3.9 billion.
Sources are concerned, though, that since demand for leather garments is slowing down and Rupee is strengthening the target may not be achieved.