Chennai: Similar to last year, apparel exports are likely to decline by 4-5 per cent this fiscal as the sharp decline in UAE shipments continues to hurt the sector.
Last year, apparel exports had declined by 4 per cent after registering modest growth rates of 1 per cent and 3 per cent in FY16 and FY17 respectively. Till January this year, exports were down by 6.56 per cent in US dollar terms. Exports have been de-growing till September and in that month it de-grew by 34 per cent. Despite registering the growth since October, yearly exports are once again staring at de-growth.
Even the growth post October has not been encouraging as this has been achieved due to the low base effect.
"The decline in India's apparel exports in FY19 so far has been primarily driven by a sharp inexplicable decline witnessed in shipments to the United Arab Emirates from July 2017 onwards," Jayanta Roy, Senior Vice-President and Group Head, ICRA.
Apparel exports to the UAE started declining sharply after the introduction of GST and reduction of duty drawback rates.
