India's textile and apparel industry faced a significant setback in May, with exports experiencing a year-on-year decline of 12.2%. The low demand in key overseas markets, particularly the United States, continued to plague the industry.
Textile exports contracted by 11.8%, while apparel exports witnessed a decline of 12.7%. Other sectors also suffered, with jute products slumping by 29.3%, and handicrafts and handmade carpets falling by 21.1%. The total value of India's textile and apparel exports for the month amounted to $2,816 million, compared to $3,206 million in May 2022.
The reason attributed the slump to sluggish demand in major importing countries, such as the United States, Germany, and the United Kingdom, influenced by inflation and inventory accumulation. However, there are positive signs of improvement as exporters gradually secure new orders.
The reopening of China after COVID-19 also presents opportunities for business growth, particularly in yarn and fabrics. Additionally, the moderation of domestic cotton prices offers hope for increased sales from July/August. Despite signs of recovery in the U.S. market, exports to the European Union have not met expectations.
Competing countries' duty-free access grants them an 11% cost advantage. Therefore, industry feels there is a pressing need to expedite the free trade agreement with the U.K.
