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Handicraft exporters face double trouble with Eurozone crisis

08
Jun '10
Eurozone's financial crisis has come as a huge setback for the Indian handicraft exporters, as they had just started nursing their injuries, which had occurred due to world economic downturn and had affected them adversely.

Handicraft exporter and Chairman of Carpet Export Promotion Council (CEPC), OP Garg said that, the European crisis was adversely affecting the Indian handicrafts exporters, as the departmental retail stores, wherein, handicraft goods were stored, were now shutting down owing to, declining demand and financial pressure.

Due to the recent world economic downturn, about 25 percent US and European markets, trading in Indian handicrafts goods, have shut shop. This has created grave apprehensions amidst exporters in the Indian handicrafts industry, added Garg.

Currently, adding to the woes of Indian exporters in their business is the freeze in European countries for launching new departmental retail stores, pointed Garg

Products that have witnessed huge reduction in demand so far in the European Union (EU) markets are hand-printed textiles and scarves, zari products, metalware, woodware and imitation jewellery

Both US and EU account for more than 65 percent of the country's handicrafts exports. While US is the biggest purchaser of Indian handicrafts and totals for more than 32 percent of the overall handicraft exports, EU follows next with more than 22 percent of the exports.

Supporting Garg, is Rakesh Kumar, Executive Director, Export Promotion Council of Handicrafts (EPCH) who said that, the European financial crisis have hit so hard to the Indian handicraft exports, that many payments have also been stopped, specially from Greece. More so, exporters are witnessing a dearth in orders booked from Europe, owing to, this crisis. They are not coming in the bulk form.

Not only have people stopped placing orders from overseas markets, but the purchasers are also delaying and ceasing payments, from Greece specially, added Kumar.

With worries are also increasing payment defaults from European countries, and as this business mostly comprises of small and medium-scaled firms, it has become difficult for them to recover their losses, informed Kumar.

Owing to this crisis, Indian handicraft exporters have started tapping other markets such as South America, Africa and the like, to continue to receive orders and stay in the business.
These countries, apparently, are giving great orders and therefore, the demand for Indian handicrafts is slowly picking up in these markets, which were never tapped or explored earlier, during the past few years, concluded Kumar.

Fibre2Fashion News Desk - India


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