Rising manufacturing costs hurts apparel exports

Increasing production costs coupled with low overseas

demand are two factors hurting the Indian apparel exports. And neighbouring countries like Bangladesh, Indonesia, Vietnam, Turkey and Mexico are benefiting at the cost of India. The comparatively cheaper rates in these countries are luring overseas importers.

Statistics released by the Apparel Export Promotion Council (AEPC) reveal Indian apparel exports fell by 7.2 per cent year-on-year in the month of August and in April-August 2012 period, apparel exports declined by 12.6 per cent year-on-year. Recently, the US complained to World Trade Organisation (WTO) accusing India of wrongfully giving fresh export subsidies to its textile industry instead of allotting them as mandated by the WTO. It has also complained to the multilateral body about the country ignoring its requests for bilateral discussions on the issue. Turkey, too, has expressed its unhappiness at the alleged rise in textile exports from India and its industry being pitted against subsidised Indian products.

While the government has refuted the allegations, textile and apparel exporters seem to be caught in situation from both the ends. While, on one hand they are already suffering due to low or no orders from the traditional export markets like the US and EU due to economic slowdown, such accusations are further adding to their woes.