Oct 17, 2022
Deep fall in other currencies hurt India; textile exports down in September
Oct 17, 2022
India's textile exports declined in September this year, even as the other textile-exporting countries continue to perform better than India. An analysis has revealed that Indian exporters are losing in the international textile market as the currencies of competing countries registered a deeper fall against the US dollar compared to the India rupee.
According to an analysis by the Confederation of Indian Textile Industry, India’s textile exports have registered a fall of 31.88% to $1,464.59 million in September 2022. While apparel exports declined by 18.06% to $1,066.18 million in the same period. Cumulative exports of textiles and apparel decreased by 26.67% to $2,530.77 million in September 2022.
During April-September 2022, Indian textile exports went down by 16.98% to $10,050.93 million, while apparel shipment rose by 11.42% in the same period. Cumulative exports of textiles and apparel during this period decreased by 6.26% to reach $18,222.70 million. The share of textiles and apparel in India’s total merchandise exports declined to 7.14% in September 2022 compared to 10.21% in September 2021. The share fell from 9.81% to 7.86% in April-September 2022.
The strengthening of the US dollar against the local currencies is making exports more viable. Fall in the Indian rupee against the USD should benefit Indian exporters but the trend is hitting exporters hard as the currencies of other competing countries have fallen deeper.
An analysis shows that Indian rupee fell by 10.7% to 84.43 per USD since January 2022 when the exchange rate was noted at 74.43. But Sri Lankan rupee declined by 80% in the same period. The currencies of Turkey, Pakistan and Bangladesh declined by 40, 24 and 18% respectively. Only Vietnam’s currency depreciated lesser than INR. Vietnamese dong fell by 7.26% since January 2022.
The higher depreciation of local currencies against the USD has provided more cushioning to the exporters from the competing countries. Data shows that Indian exports are underperforming compared to the other countries. Indian exporters feel that this situation in the international market is a major cause for concern as they are unable to compete against the other countries. They are losing export orders as they are not able to offer competitive prices to their importers.
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