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Readymade Garment exports up 25 per cent in September in Rupee terms

Good news from the export front. The ready made garment exports of the country have risen by 25 per cent in rupee terms and thirty per cent in US Dollar terms during last month (September) compared to corresponding month last year. The exports witnessed a steady declining curve during the last three months in a row but got revived in September.

As the goverment's policies towards this sector continues to be hostile this export performance is not sustainable in the coming months according to sources in the exporting community

The ready made garment exports rose to  Rs 10,707 crore in September 2017 from Rs 8,583.55 crore in the same month a year ago. In dollar terms, these figures were $1.662 billion as against $1.284 billion. Of the total RMG exports, 52 per cent is woven and 48 per cent is knitwear.

The sector started the financial  year in April with 27.60 per cent growth in rupee terms and a 31.65 per cent increase in dollar terms. But in the following month growth (in rupee terms) was hardly 3.84 per cent.

Exporters say that garment exports this year will surpass last year’s total exports of 17.358 billion US dollars as, generally, exports tend to grow in the second half.

January to March are the crucial months for exports. Around 30-40 per cent of exports have taken place during these three months in the last few years.

Exporters attributed the increase in sales mainly to the upcoming Christmas season in Western markets. The other factor is that inventories piled up due to the GST are now being cleared. a spokesman of the Tirupur Exporters’ Association said that people are now becoming used to the GST system. In the last three months while global demand was increasing, exporters could not cater to it due to tax-related confusion. “Now we don’t have a choice, but the GST makes our products costlier compared to other countries,” d . The September numbers are not sustainable in the current environment.

Unless India signs an FTA with European countries exporters will be in deep trouble. Competing nations like Bangladesh, Vietnam and Cambodia have a duty advantage, which India does not possess.

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