As per the latest report by ICRA, an Indian independent and professional investment information and credit rating agency, induced by the expectations of higher fibre prices and growth in apparel sector, Indian textile exports are likely to witness a surge of 6 per cent to US $ 40 billion in FY 2017 despite the de-growth of 2 per cent in the fiscal year 2016.
According to some other estimates by ICRA, volume growth is also expected in segments like textile made-ups and home furnishings, which will support the overall rise in value of textile exports from the country.
Anil Gupta, VP, Corporate Sector Ratings, ICRA averred, “Despite volume growth in most of the segments, de-growth in the value of textile exports during FY 2016 was driven by lower fibre prices (cotton as well as polyester). For FY 2017, while raw-cotton export is expected to decline, however, other segments, especially apparels, shall see positive volume growth, especially due to improved export competitiveness supported by the recent financial package for the textile industry.”
However, it may be mentioned here that on a year-on-year basis, textile exports have continued to decline by 6 per cent and stood at US $ 5.7 billion in the first two months of fiscal 2017 as against US $ 6.1 billion in the comparable period last year and US $ 6.4 billion in the same period of FY 2015 due to lower fibre prices… Polyester and cotton prices stood lower by 10 per cent and 4 per cent, respectively till May this year, which is reflected in the decline in value of exports from India.
Nonetheless, the growth in value terms is expected to be back on track in the near future as higher input costs will partially be required to be passed on to the buyers, maintains ICRA.