India’s textile and garment exports rose less than forecast for the fiscal year 2014-15, sparking concern about the industry’s outlook ahead of a new National Textiles Policy that’s expected to be announced in July.
The government projected exports of $45 billion for the fiscal year, but shipments increased by only 3 percent to hit $41.4 billion compared to $40.8 billion the previous year. An official statement revealed overseas sales of ready-made garments rose 12 percent, while silk climbed 13 percent and wool and woolen textiles registered 18 percent growth.
Despite falling short of expectations, the government has since set a target of $47.5 billion for the current fiscal year. And that’s not all: Sanjay Kumar Panda, secretary of the Textiles Ministry, projects the pending policy—currently being finalized for cabinet approval—will push the country’s exports to $300 billion by 2024-25 while generating 35 million jobs. It also aims to address workforce challenges and labor reforms, attract investments and provide a road map for the future of the industry.
In the meantime, the ministry is seeking 13,000 crore rupees (or $2.03 billion) from the Finance Ministry for the Technology Upgradation Fund (TUF) scheme—an interest subsidy scheme that encourages technological improvement by providing credit at reduced rates—to help the textile sector compete with Vietnam, Bangladesh, Turkey and Pakistan.
“We had sought 12,000 crore rupees ($1.87 billion) for the 12th Five Year Plan but only 7,000 crore rupees ($1.09 billion) has been assigned. So we are hoping that we get the remaining 6,000 crore rupees ($938 million) out of the 13,000 crore rupees demanded in the next two years,” Panda said at a press conference earlier this week, pointing out that the government also approved 20 textile parks over the past year that are likely to generate 75,000 jobs once they’re fully operational.