The country's textile exports to the US have remained steady during January-April 2006, but prices grew at a slower pace than China's, according to a report by Macquarie Research. This has been attributed to a sharp decline in the Chinese prices in the first half of 2005, which resulted in a low base effect. Indian exports to the US grew 12% and 18% in volume and value terms, respectively. Chinese exports on the other hand, have grown about 3.04% in value terms in the same period. Chinese exports of apparel also fell considerably by 12.30%, according to cotton Textile Export Promotion Council (Texprocil). It was further indicated in the report that India's steady performance in the post-quota era has helped make better inroads into the US market. India's market share is now up to 6.7%.
Imports of yarns (all fibres) from India the US have grown by 182.97% and fabrics (all fibres) by 27.62%. Whereas, import from China of these items have grown by 193.60% (yarns), 11.18% (fabrics). Madeups from India have only grown by 1.17%, while China saw a rise of 11.02%. A redeeming feature in the fabric basket is that India has been able to surge ahead especially in the growth of knit fabrics (126%) and cotton hosiery (251%), just like in cotton yarn.
Based on official data for the first six months of the fiscal year (FY), cotton textile exports for FY 2005/06 (April-March) are estimated to increase by about 14% over the FY 2004/05 level of $3.4 billion. Exports of readymade garments (mostly cotton-based) are expected to grow 34% over the FY 2004/05 exports of $6.2 billion.
India’s competitiveness in the post-Multi Fiber Agreement (MFA) quota system will likely fuel double-digit growth in cotton textile exports, which should allow it to capture an increasing share of the global textile trade over the next few years. India will be in the export market for the next 2-5 years, until domestic consumption catches up with the recent production surge. Most exports will be of medium-to-long staple cotton (25 to 32 mm length) to neighboring countries, China, and various Far East destinations. Traditionally, Indian cotton used to be discounted by five to six percent vis-à-vis comparable international cotton because of lower quality (higher trash, lower consistency, etc). But in the last two years buyers of Indian cotton have expressed satisfaction with the quality, and now offer competitive prices.
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