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India may miss garment export target
November, 28th 2008
India is likely to miss the $12-billion garment export target this fiscal as the overseas sales are expected to fall below last year's level, an exporters' body today said. Apparel Export Promotion Council (AEPC) said the industry was facing huge losses on account of drying up of orders from the US and European markets in the backdrop of financial crisis. Exports may drop to $8.78 billion in this fiscal, 24 per cent below the target set for 2008-09. Last fiscal, India had exported garments worth $9.69 billion. But the global financial meltdown, particularly in the US and European Union, is impacting the Indian garment industry, with lakhs of workers being laid off, AEPC Chairman, Mr Rakesh Vaid said. Last week, Commerce Secretary, Mr G K Pillai had said there would be about five lakhs job losses in the textile industry in the next five months. AEPC has asked the government for a hike in duty drawback rates, research and development assistance and income tax exemption for five years. It has also sought interest-free loans for investment in machinery with zero-duty import of capital goods scheme and lower fringe benefit tax to offset losses. Many importers have cancelled orders or postponed their delivery schedules. The market sentiment is very weak,'' Mr Vaid said adding overseas buyers are now renegotiating contracts. Several foreign retailers like Steeve and Barry's along with Mervyns have filed for bankruptcy and more are expected. Pacific Sunwear has closed 150 stores, while Lane Bryant, Fashion Bug and Catherines are closing 150 outlets. - PTI
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