Thanks to a major slowdown in demand from the US and Europe, India’s government now expects a decline of over 10.5% in apparel exports by the end of the fiscal year. Garment exports during 2011-2012 fiscal year stood at about $14 billion, but the government in now targeting $12.5 billion for 2012-2013.
“The US market is picking up now,” an official from the Apparel Export Promotion Council told The Economic Times. “But the demand is still sluggish in the European market.”
India’s garment industry depends on business from the US and Europe, which collectively account for more than 65% of their garment exports. The recent economic slowdown in both markets has highlighted the necessity of diversifying their customer base, and India has responded by seeking new customers in Latin America and Russia.
The new customers won’t generate enough business to reverse the course this year, but the same official reported that India has also begun to receive orders from Japan, Israel, South America and South Africa. “The new markets have started working for us,” the official said.