Apparel exporters face severe order crunch

Indian Government under its 11th Five Year Plan has chalked out ambitious plans of exporting 6 billion apparel pieces at US$ 34.02 billion by 2011-2012. This target is a pipe-dream considering the fact that exporters are reeling under severe order crunch and will be unable to even reach last years’ export level, said Mr. Amit Goyal, President, Confederation of Indian Apparel Exporters (CIAe).

He said during the tenth Plan period, exports of readymade garments had increased at the annual rate of growth of 14%. The major increase was witnessed in 2005-06 when it increased by 28%. However, the appreciation of the rupee has hit the exporters below the belt and there is no respite coming from the Government. The situation is alarming as export orders have nose-dived by 10% to 15% and for the first time in the apparel export history, India will end 2007-2008 fiscal in negative. The export orders are on decline as India is unable to offer competing prices. The orders are going to countries like China, Bangladesh, and Sri Lanka. Even a country like Indonesia, which was not a big time exporter is on the global scene because its industry is able to compete on price front,.

Presently, apparel exporters employ 2.5 million people and the Government envisages that another 2.5 million work-force would be required to achieve the target of US $ 34 billion by 2011-12.