Garment Exporters Invest Rs 600 Cr To Up Capacity

New Delhi: | Updated: Jan 22 2003, 05:30am hrs
Indian garment exporters have intensified investments in the capacity expansion and quality upgradation projects to meet rising demand from global buyers and also to seize opportunities that will follow from the lifting of garment-quota regime in the US beginning 2005.

India has around 22,000 registered garment exporters. But the number of active exporters is put at 9,225 as on December 31, 2002. There are 49 firms with turnover in excess of Rs 50 crore with the largest exporting entity doing business of over Rs 350 crore.

Speaking on the sidelines of India International Garment Fair-Autumn/Winter 2003-04, Apparel Export Promotion Council director Vijay Mathur notes: Indian garment exporters invested Rs 600 crore in 2002, up from Rs 451 crore in 2001. This is aimed at creating fresh capacities and enhancing quality standards. We expect the investments to remain at a higher level this year also as more and more exporters comply with quality norms of global buyers.

Adds Mr Mathur: Currently, many Indian exporters whether small, medium or large are not able to take more orders because of capacity constraints. Most have also realised that the lifting of quota regime in the US beginning January 2005 will throw open opportunities to numerous exporters the world over and that Indian exporters with their superior cotton garments and embroidery will remain globally competitive.

Indian exports command a premium in the western markets. As compared to the average price of $5.2 per piece from global imports, Indian imports cost $6.08 per piece in the US. Currently, US garment-quota regime puts a cap on the number of exporters and export volumes.

Chinaspecialising in synthetic yarn-based garmentsaccounts for the bulk of global garment exports of $195 billion a year with exports of $35 billion. Indias exports in 2003 is put at $5.5 billion ($5 billion in 2002) compared to $5.8 billion for Bangladesh, $3 billion for Pakistan and $1.8 billion for Sri Lanka. Of the overall exports, the EU accounts for $86 billion and the US $59 billion.

Interestingly, Indian exporters are seen as ladieswear specialists: around 75 per cent of Indian exports comprise womenswear (including unisex t-shirt) and India is the No 1 exporter of womenswear to the US.

Mr Mathur notes that the garment exporters are realising the need for broadening the export basket.

Man-made fibre in India is expensive and lacks variety needed for competitive exports. Whenever we try sourcing from China and Taiwan, our delivery time rises by 30 days over our usual 70 days. Weve asked the government to have a flat 10 per cent duty against a steep 59 per cent now, he adds.