Supported by the government stimulus package, the Export Promotion Council for Handicrafts (EPCH) is expecting a 10% recovery in the handicrafts exports to Rs 9,000 crore for the current fiscal.
The exports dipped by a steep 48% last year owing to the economic downturn. ?Handicrafts exports were down 48% in 2008-09 at Rs 8,183 crore due to economic slowdown. Now, we are on the recovery path and expect exports to touch Rs 17,000 crore by 2011-12,? EPCH executive director Rakesh Kumar said.
?Recession had hit the purchasing power of our buyers. This year, things have begun to look up and buyers now seem to be more confident. The stores in the US and the European Union (EU) have now exhausted their stock and are placing fresh orders. The US and the EU together accounted for 78% of India?s handicrafts exports in 2008-09,? Kumar added.
The EPCH is now diversifying its market from US and EU to Latin American Countries (LAC), Caribbean and South Africa. ?This will help us minimise risk. The LAC is a huge market for Indian handcrafts products and can generate business worth Rs 5,000 crore in the next five years?, Kumar noted. Over a period of time the EPCH would also like to explore opportunities in Eastern Europe and the Middle East.
Kumar, however, explained that the logistics and delivery delays are the major roadblocks in capturing the LAC market. The EPCH has proposed to open a warehouse in the LAC, preferably Uruguay, that will provide complete logistics ad marketing assistance to the exporters. ?The scheme entails a Budget of Rs 200 crore over five years and the government has approved this scheme in the second stimulus package. Through this, we will be able to export directly to LAC, which currently imports goods from US (Atlanta and Miami) at double prices,? he said.
?The recovery started only 6 months ago and we have almost covered the decline which is a good sign. Lot of artisans had become unemployed and opted for alternate jobs. The decline has stopped now which is good news of artisans as well as exporters. We are sure of achieving a 5-10% growth rate starting from April this year as compared to the same period last year,? Raj Kumar Malhotra, chairman Asian handicrafts said.
Malhotra said that the government?s intervention and support in this sector was a major reason of its revival at this pace.
?Industry was in a bad shape until the year 2008-09. The sales went down over 50% and lot of exporters closed down. The recovery started when government announced various packages and subsidies for this sector. For instance, the import duty on handicrafts was scrapped by 5%, handicraft machinery was made duty free and many more incentives were given to the exporters. Participation in foreign exhibitions also received lot of government support and incentives.?