Textile and apparel exports during April and May this year declined 73.1% (in dollar terms) compared with the same months last year, according to quick estimates of exports released recently by the Ministry of Commerce.
Textiles and apparel worth $6,066 million were exported in April-May 2019 while it was $1,634 million this year.
Cotton textile exports during April and May this year were 64.6 % lower compared with the same period last year. Export of manmade (MMF) yarn, fabrics and made-ups was 71.1 % lower during April-May 2020 compared with the same period last year while ready-made garment exports declined 78.1 %, according to the data shared by the Cotton Textiles Export Promotion Council (Texprocil).
Texprocil chairman K.V. Srinivasan said in a press release that export of cotton textiles between April and February last financial year was $9,405 million against $11,262 million during the year-earlier period. Export of cotton yarn declined steeply, almost 28%, during this period and in April and May this year too, export of cotton yarn fell sharply.
Buyers in the U.S. and European Union (EU), the two major destinations for Indian cotton textiles and clothing, were cancelling orders or invoking force majeure clauses within their contracts. Buyers of cotton yarn were demanding a 15% to 20% price reduction.
“This is a matter of concern and the government should support the industry,” Mr. Srinivasan said. “It should cover cotton yarn and fabrics under the scheme to reimburse State and Central levies. It should also enhance the overall competitiveness of the textile industry so that India becomes a hub for fabric and yarn production to serve the domestic and export markets,” he added.
Siddhartha Rajagopal, executive director Texprocil, said the government should come out with clear measures to boost exports so that India does not lose out to competing countries.
“Textile and clothing exports were already weak last year and then came COVID-19,” he said. “Buyers are cancelling or re-negotiating orders. Textile and clothing exporters need production-linked incentives so that they are able to compete in the international market. Cotton yarn should also get the 3% interest subvention benefit”.
Observing that exporters were awaiting a nod to export PPEs and MMF masks, Mr. Rajagopal said there were opportunities that India must not lose out on as countries such as Bangladesh and Vietnam already had advantages in the international market.