With the slowdown drying up demand for Indian handicrafts from foreign buyers, retailers have turned their focus on domestic market, which could help offset the slump in exports.
Retailers like Future Group, Pantaloon Retail, Lifestyle, Rama Store, Fab India, Bharti Retail, Shoppers Stop and Delhi Duty Free Services have placed orders worth several hundreds of crores with handicraft units, in what signals that the slump in exports could be somewhat offset by an increase in local sales.
According to Rakesh Kumar, executive director, Export Promotion Council For Handicrafts (EPCH), given that overseas demand has been hit, the council has, for the first time, invited domestic retail players in the 32 edition of Asia Handicrafts and Gifts Fair and the business is estimated to be close to R500 crore.
The ministry of textiles is also addressing the problems of export finance faced by handcraft units and is in talks with banks for restructuring of loans. “The exporting community needs to work hard to double India’s share in the world market, which is merely 2% at present,” said minister of state for textiles Panabaka Lakshmi.
With the domestic dent becoming costlier because of the Reserve Bank of India’s tight monetary policy, handcraft exporters are seeking cheaper finance from overseas. The EPCH has tied up with Royal Bank of Scotland (RBS) for foreign currency loans to exporters at an attractive interest of 4%. Kumar said that EPCH's meeting with RBS could result in enhanced competitiveness of exporters in these difficult times.
Apart from this, international players like DKNY, Marks and Spensers, Tesco, Forever 21 have placed orders worth R900 crore with the EPCH's exporters for the upcoming festive season (Christmas/New Year).
“A large number of overseas buyers from the US, UK, Japan, Germany, France, Australia and Spain have placed orders for Christmas that include products which had a mix of materials like wool, metal, glass, wood along with paper products and dried flowers,” added Kumar.