Indian textile exports can hit $65 billion if industry majors take the right steps and there is proper execution of government schemes.
Indian textile exports can hit $65 billion if industry majors take the right steps and there is proper execution of government schemes, according to a joint report by global consulting firm Kearney and The Confederation of Indian Industry (CII). Exports declined by 3 percent during 2015–2019 and by 18.7 percent in 2020, the report observed and went on to add that during the same period, other low-cost countries such as Bangladesh and Vietnam have gained share.
The report said a variety of factors have contributed to India’s recent trade performance. India has factor cost disadvantages (example, power costs 30 to 40 percent more in India than it does in Bangladesh). Lack of free or preferential trade agreements with key importers, such as the European Union, United Kingdom, and Canada for apparel as well as Bangladesh for fabrics also puts pricing pressure on exporters.
Textile products hold a key position in the global value chain, with India being the world’s fifth-largest exporter for apparel, home, and technical products. The Textile industry employs almost 45 million people in the farming and manufacturing sectors. However, the country’s recent performance in global trade has not been commensurate with its abilities. “Covid-19 has triggered the redistribution of global trade shares and a recalibration of sourcing patterns (“China plus one†sourcing), providing a golden opportunity for Indian textiles to stage a turnaround and regain a leadership position as a top exporting economy.
Achieving the $65 billion exports target up from $36 billion in 2019—will require India to double down in the five key areas – apparel, fabrics, home textiles, manmade fibre and yarn and technical textiles. The path to achieving these targets will entail both government and industry taking crucial steps. And the government seems geared up for the challenge.
Source: The Economic Times
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