The Apparel Export Promotion Council (AEPC) has called for a carefully considered strategy and a pragmatic approach to arrest the rise of the rupee.
The apparel industry was very hopeful after the special package offered to it in June 2016, where significant financial and investment incentives were offered, besides critical labour flexibilities, with the aim to generate 100.3 lakh additional jobs and 30.04 billion US dollar additional exports, AEPC said.
The growing cotton prices and rupee appreciation is not only going to nullify the intended impact of the package, but also weaken India’s position against its competitors, if left unchecked, AEPC chairman, Ashok Rajani cautioned.
Chinese Yuan depreciated by 13 per cent, Bangladesh Taka by six per cent and Vietnam Dong by seven per cent whereas India’s rupee hardened by almost six per cent over the last 3 to 5 months. Moreover, China got the highest foreign direct investment during this period.
Cotton prices have increased by 24.7 per cent on an average, across all categories in the last one year. In fact some categories have seen hike of up to 35 per cent, he added.
India’s readymade garment (RMG) exports were to the tune of 1.60 billion US dollar in February 2017 with the growth of 5.05 per cent against the corresponding month of February 2016 which was 1.52 billion US dollar. In rupee terms, the exports stood at Rs.10,764.56 crore in February as against Rs.10,424.28 crore in the corresponding month of 2016.
The country’s RMG exports during April-February were to the tune of 15.544 billion US dollar, increasing by 0.57 per cent compared to the same period of previous financial year. The government has set a target of 30 billion US dollar for garment exports by March 2019.
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