The over $50-billion domestic textile industry has appreciated the recovery in the US economy during the September quarter. But industry players have also expressed doubts whether the development will help the industry s exports end with a positive growth in the current financial year.
The US economy, which grew at an annualised rate of 3.5 per cent in the July-September period, is the largest import market for domestic textiles, consuming close to 40 per cent of India textiles exports.
Gokaldas Managing Director Rajendra Hinduja said: There is an improvement of 8-10 per cent in order flows, but prices are still under pressure. The first two quarters of the current financial year have not been good for exporters. While I believe the apparel segment may end with a growth of 5 per cent, it remains doubtful whether it will be replicated for the entire textiles exports.
During the period April-September, the country s textiles exports reported a decline of around 12 per cent on a year-on-year basis. Industry experts dithered on whether the second half could offset the decline seen so far.
Confederation of Indian Textiles Industry (CITI) Secretary General D K Nair said: Since the recent growth in the US came on the back of the huge stimulus for several sectors, it is yet to be seen whether it would be sustainable. I do not see the domestic textiles sector posting a positive growth in exports in FY10. There could be an overall decline of 5 per cent in exports for the current year.
If exports end up in the negative territory, it would be registering a decline in exports for the third consecutive year. Last year, textiles exports stood at $22.75 billion a fall of 2 per cent over the previous year.
Raymond UCO Denim COO S K Gupta said: It is too early to make an assessment. Retail buying in the US is crucial.
Rupee rate too is a concern for the textile exporters. According to them, if the currency remains above Rs 46.5 against the US dollar, exports will see a revival within a quarter.
