Govt raises textile export target at $40.5 bn for FY'13

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SME Times News Bureau | 25 Jun, 2012
Despite slow demand in the global market, the government has revised upwards the textile export target to USD 40.5 billion for 2012-13, reports media recently.

Earlier, the Textiles Ministry had set an export target of USD 38 billion for the current fiscal.

"After sops were announced in the Foreign Trade Policy (FTP), the exporters have responded positively and based on it we have revised this year's textiles exports target upwards," Textiles Secretary Kiran Dhingra told agency.

Segments including apparel, handicrafts and carpets are upbeat about exports performance this year, she added.

To boost exports, the Government has extended the interest subsidy scheme for one more year till the end of the current financial year. This will benefit carpet, handloom, handicrafts and small and medium enterprise (SME) sectors. In addition, the Government has also included the apparel sector in the scheme.

For clothing exports to the EU and US, the Government has extended the market-linked focus product scheme till March 31, 2013.

The Export Promotion Capital Goods (EPCG) Scheme for technology up-gradation has also been extended till the end of the current fiscal. The scheme allows capital goods import at zero percent customs duty with an obligation to export goods worth at least six times of duty saved in six years.

During April-May this fiscal, the country's handicrafts and carpets shipments grew at an average rate of over 10 per cent year-on-year. However, apparel exports growth remained flat during this period.

"The textiles exports trend in the first two months have been slow compared to the last year, yet the industry is pinning hopes on the recent announcements in the FTP, rupee depreciation and new markets," Dhingra said.

The exporters are exploring new markets like Latin America, Russia, Japan and Africa to reduce dependence on traditional markets like the US and Europe.

The US and Europe comprise 65 percent of the country's total textiles exports.

During 2011-12, India's textiles exports touched USD 34 billion compared to USD 26 billion in the previous year.

Earlier, the industry has been clamouring over high raw- material prices, high interest rates, besides demand slowdown in its major markets.

To help the cash-starved industry, the government has announced the restructuring of debt worth Rs 35,000 crore to bail out the textile mills.

The sector was hit hard by a sharp fall in cotton yarn prices and poor domestic and global demand. Textiles units were facing difficulty in repaying term loans.

"High interest rates are hurting the industry very much. The interest rate cut would enable the industry to perform better and would also be a step towards achieving the export target set by the Govt. of India," said Dr A Sakthivel, Chairman, Apparel Export Promotion Council (AEPC).