India’s overall textile and garment exports rose 20% in May on the back of a stellar performance by the apparrel segment following a demand revival in the US market as well as a weak rupee.
The overall textile and garment exports, including fibre shipments, hit $3.06 billion in May, compared with $2.55 billion a year earlier, provisional data showed. Consequently, the exports in the first two months of FY15 climbed 18% to $5.99 billion against $5.07 billion a year earlier. Garments made up for 47% of such exports.
Export of textile products grew at a much slower pace than that of garments, the data showed. While apparel shipments gained 24.9% in May, textile exports grew just 8.6%.
“Textile exports have been affected by slower purchases by China, as it accounts for 40% of Indian cotton yarn exports,” said DK Nair, secretary-general, Confederation of the Indian Textile Industry (CITI). However, the festive season demand will boost domestic consumption of textile items and a weak rupee would help exports, he said, adding if China improves its appetite in the coming months it would further brighten export prospects. The rupee has depreciated 3.4% against the dollar since June this year.
In FY14, the rupee depreciation and steady orders from the US drove up overall textile and clothing exports to $39 billion, compared with $34 billion a year earlier. However, the exports were still lower than the target of $43 billion for 2013-14 as demand recovery in the European market was slow due to a financial crisis. Textile exports are dependent on Chinese demand while the growth in garment exports hinge on the US and the EU markets.
Having slid by nearly 6% in FY13 and witnessing drop in 10 of the 12 months, garment exports started picking up from March last year as the domestic currency continued a downward journey and demand from the US started picking up due to an economic recovery. Soaring costs in China and problems in compliance of global safety norms at Bangladeshi mills also helped India’s export growth, industry executives said.