India likely to miss wool export target on slow demand in FY17

India is likely to miss its target of wool and wool-blended exports set of $610 million for 2016-17 due to slowdown in demand in its main export markets – the US, European Union and the UAE and moderation in commodity prices.

Punjab accounts for 35 percent of the total exports of wool and wool-blended products, followed by Maharashtra and Rajasthan. The slowdown in global demand has affected medium-sized manufacturers in Ludhiana and Amritsar.

Moreover, 70 percent of the exports are concentrated in the US and European countries, so any fall in demand to definitely impact the exports to a substantial level.

Worried over incessant fall in exports of woollen products, the woollen manufacturers are exploring options to reduce its dependency on the US and European markets, facing slowdown. The manufacturers are planning to increase their exposure in Kazakhstan, Australia, Germany and China.

RK Gupta, Executive Director, Wool & Woollens Export Promotion Council (WWEPC) said that to increase the exports, the exporters have decided to participate in international trade fairs in Kazakhstan, Germany, Denmark, Russia, Singapore, Canada, Mexico etc.

The exporters also suggested that the Council should also make efforts to organize reverse buyer-seller meets to increase the export of woollen products.

In addition to this, the woollen industry has also demanded to exempt raw wool from import duty, abolish import duty on woollen textile machinery and increase in duty drawback rates.

Sushil Kaura, chairman, WWEPC, said that keeping in view the export trends, the committee had proposed the same target of $610 million for the year 2017-18.

In 2015-16, India imported wool worth $308 million as compared to $349 million in 2014-15. The decline in wool import was mainly attributed to the decline in exports owing to weak global sentiments. The Council also requested the Central government to abolish import duty on woollen textile machinery, which is currently between 7.5% and 15%.

As per the data released by the Director General of Commercial Intelligence and Statistics (DGCI&S), Kolkata, the exports of wool and wool-blended products was to the tune of $328.10 million (Rs 2,204.13 crore) between April 2016 and January 17 (2016-17), down 1 percent in dollar term and 15 percent in rupees term, as compared to the corresponding period in 2015-16. The total value of exports in 2015-16 was $462 million (Rs 3,013 crore).