India’s handloom export plunge to Rs1,500cr, 30% decline in FY2015-16

The handloom export of India was worth Rs2,240 crore a year ago which has come down to Rs1,500 crore in the fiscal 2015-16, states the annual report of the textile ministry. This is just 65% of the target fixed by the ministry.

The latest statistics of the ministry indicate that the handloom sector needs an urgent attention. Share of handloom in total textile export at an all time low at 10%, changing consumer preference and slowdown in EU and US to be blamed but India’s handloom export has declined by 30% within a year after a gradual rise for several years, according to government figures.

Home textiles (like bed linen, furnishing material and cushion etc.) and carpets-durries-mats which together constitute nearly 90% of the total handloom export are hit majorly. Handloom sarees and other dress materials contribute to less than 10% of the total export volume.

While the report does not give reasons for the decline and country-specific data yet to be released, the industry sources said that exports to India’s largest importers of handloom – USA has dropped sharply in the last fiscal with the demand in the USA remaining below pre-2008 levels.

Irani was unreachable for comments. An email sent to Handloom Export Promotion Council (HEPC), a month ago didn’t elicit any response till Thursday. Economic slowdown in the US and the EU seem to have adversely affected India’s handloom exports, said industry sources.

Besides global slowdown, competition from other countries, fast changing consumer preferences, high production costs, and market dynamics are said to be the major reasons for the decline.

A textile expert said that countries like Pakistan, Sri Lanka and Bangladesh are giving them tough competition after EU removed India from the preferential duty list in January 2014. Textile exports from India suffer 8% import duty in European countries while the same is not liable on products from Pakistan and Bangladesh.

Domestic sale has also declined in the last two years, according to sources even as the latest statistics are unavailable. The ministry’s latest annual report talks about the dwindling sales figure of the government-run All India Handloom Fabrics Marketing Cooperative Society. From Rs45 crore in 2013-14, the sales dropped to Rs34 crore in 2014-15, states the report.

Handloom, a fabric woven by hand, makes up over a tenth of India’s total fabric production. With 43 lakh people directly involved in the production, it is the second largest employer after agriculture.

Since 2015, the government has started celebrating National Handloom Day on August 7 to promote hand woven products and support the weavers. However, the sector suffers from lack of modernization and availability of raw material at a reasonable price.

An initiative to give a big push to the weavers with the help of top designers of India has started at prime minister Narendra Modi’s constituency Varanasi, known for Benarasi sarees, and a few other clusters. They are trying hard to market their products at international level by holding exhibitions and by roping in e-commerce platform, but it is still a long way to go,” admitted an official.

Meanwhile, young generations of the weavers are leaving the traditional work slowly. The statistics reveal that the total weaver households in India have declined from 29.9 lakh to 22.6 lakh in past 25 years.

According to observers, Smriti Irani has a tough job ahead considering the challenges of the entire textile sector. With GST in place, the sector will be affected more.