Interviews
Textile sector exports on road to recovery
25 Sep '09
2 min read
The textile sector in India seems to be coming out of the comatose state it had slipped in to in the last few months. The order books of exporters from the sector are full and a few experts from the sector believe that the worst period is over. Experts also expect things to settle down by the next two quarters after which they expect the situation to revert back to the fast moving trends witnessed in 2007 and the first few months of 2008.
The only worrying matter for the textile exporters is the increase in credit period. From a 30 days credit period in the initial days of the economic turmoil it has now increased to between 90-120 days, making it extremely difficult to manage working capital requirements.
Mr DK Nair, Secretary General of Confederation of Indian Textile Industry (CITI), speaking exclusively to Fibre2fashion said “There are early signs of a recovery in the economies of developed countries, which are the major markets for our textile products. Germany, France, Italy and Japan are already out of recession and the USA is expected to follow suit soon. This has rejuvenated our T&C industry's export activities. While actual increase in exports has not yet become visible, I expect exports to start looking up by the last quarter of 2009”.
He added by saying, “As stated above, the economic recovery in our major markets is one encouraging indicator. Domestically, we had serious problems last year from high cotton prices. The increase in cotton prices was because of the way MSP operations were carried out, especially disposal of procured cotton, but this year, we expect MSP operations to be handled better, on the basis of experience gained during last year and a good cotton crop in new cotton year will add to our competitiveness, which can also help our industry to revive in domestic and global markets, to some extent”.
He concluded by saying, “Countries like China, Bangladesh and Vietnam have been increasing their market share in the western market even during the slowdown and competition from them will be a major threat, when the markets recover. Uncompetitive priced man made fibres, because of duties and price manipulations by producers are another challenge. Lack of trained workers where they are required is also a challenge our industry has to face in the short term and also long term”.
The only worrying matter for the textile exporters is the increase in credit period. From a 30 days credit period in the initial days of the economic turmoil it has now increased to between 90-120 days, making it extremely difficult to manage working capital requirements.
Mr DK Nair, Secretary General of Confederation of Indian Textile Industry (CITI), speaking exclusively to Fibre2fashion said “There are early signs of a recovery in the economies of developed countries, which are the major markets for our textile products. Germany, France, Italy and Japan are already out of recession and the USA is expected to follow suit soon. This has rejuvenated our T&C industry's export activities. While actual increase in exports has not yet become visible, I expect exports to start looking up by the last quarter of 2009”.
He added by saying, “As stated above, the economic recovery in our major markets is one encouraging indicator. Domestically, we had serious problems last year from high cotton prices. The increase in cotton prices was because of the way MSP operations were carried out, especially disposal of procured cotton, but this year, we expect MSP operations to be handled better, on the basis of experience gained during last year and a good cotton crop in new cotton year will add to our competitiveness, which can also help our industry to revive in domestic and global markets, to some extent”.
He concluded by saying, “Countries like China, Bangladesh and Vietnam have been increasing their market share in the western market even during the slowdown and competition from them will be a major threat, when the markets recover. Uncompetitive priced man made fibres, because of duties and price manipulations by producers are another challenge. Lack of trained workers where they are required is also a challenge our industry has to face in the short term and also long term”.
Fibre2fashion News Desk - India
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