'Sops under MEIS to boost India’s cotton textile exports'

Deepak Kumar | The Dollar Business  

The inclusion of cotton fabric among the list of products for giving duty benefits under the Merchandise Exports India Scheme (MEIS) is likely to revive India’s cotton exports which have been going through a rough phase in recent months, say experts. During September this year, exports of cotton yarn and made-ups fell by 3.58 % to $911 million from the last year’s $945 million. Exports of textile & clothing sector in September registered a decline of 5.71%, while the garment sector as a whole witnessed a negative growth of 12.02%. During the first six months of the current financial year, outbound shipments of cotton yarn contracted by 2% to $5.16 billion from $5.28 billion registered during the same period last year. Exports of cotton yarn and made-ups have been shaky in recent months as less demand in the global market has hit the domestic cotton producers. However during April-September 2015, exports of textiles & clothing sector recorded a marginal growth of 0.54%, thus giving an indication that its outbound shipments might pick up in coming months. The decline in exports has also been attributed to a weak domestic market as farmers have been reluctant to invest in cotton production. Other countries, especially Vietnam, have continued to increase its share in the global merchandise exports. “The second half of the season is generally more buoyant. The market is now slightly normal. Things are likely to pick up now. The announcement of including textile under the MEIS is indeed a good move, but in order to regain what we have lost, the government needs to put in extra efforts,” Delhi Exporters Association President Tilak Raj Manaktala told the Dollar Business. “China is currently the largest textile producer in the world. It has been taking significant initiatives to export cotton and other textile products at cheaper rates. On the other hand, our domestic production has been affected due to various domestic issues and a weak global demand. We are hopeful that the industry will pick up in coming months,” Subodh Jain, Chairman &Managing Director at Niryat Sam Apparels Ltd., told the Dollar Business. The Directorate General of Foreign Trade last week announced the addition of 110 new products under the MEIS scheme covering more countries, especially in Africa and Latin America, for giving incentives to exporters. In the recently concluded India-Africa Forum Summit, India had sought more textile exports engagements with the African nations.   

November 02, 2015 | 3:57pm IST.