India apparel exports saw booming numbers in May, thanks in part to strong demand from non-traditional markets like Latin America, East and West Asia and Southern Africa. May apparel exports climbed 24.96% to $1.49 billion, despite sluggish shipments to the country’s more established partners like the U.S. and Europe.
The spike, the Apparel Export Promotion Council (AEPC) said, is the result of labor and regulatory problems in major competitor markets including Bangladesh, China and Myanmar. The value of apparel exports in the first two months of the current fiscal year stand at $2.81 billion–a 20 percent increase from the corresponding period of last fiscal year.
Overall, India’s May exports grew 12.4% to $28 billion from $24.9 billion the previous year. In addition to garments, healthy engineering and petroleum sectors were said to help exports move upwards.
In contrast, total imports slumped 11.4% to $39.23 billion, resulting in a trade deficit that reached a 10-month high of $11.23 billion in May.
Looking forward, industry leaders remain upbeat. If the upward trend continues next month, commerce secretary Rajeev Kher said it would confirm “a revival in global demand” for India-made products. Kher described the increase in total exports as “an encouraging sign” and noted that the appreciating rupee was not a factor.
However, some exporters believe otherwise. According to The Hindu, knitwear exporters are appealing for the Reserve Bank of India’s intervention to “limit” the rupee’s rise against the dollar so as to obtain better unit value from the exports.
In a separate statement, Clothing Manufacturer’s Association of India (CMAI) echoed Kher’s optimism and reported that India’s apparel exports are set to cross $17 billion mark in fiscal year 2015, up from $15 billion in 2014.
“India’s total textile exports stood at $32 billion of which apparel exports were $15 billion in fiscal year 2014. The industry is doing well and we expect apparel exports to touch $17 billion this year, a growth of 15 percent,” CMAI chairman, board of trustees Premal Udani stated.
With a solid footing in U.S. and European markets, which CMAI said accounts for 80 percent of India’s apparel exports, Udani said the industry is now shifting its focus to new markets including Japan and Latin America.