Yarn production is likely to grow by 6.8 per cent in 2012-13, mainly on account of rise in cotton yarn production, according to economic think tank CMIE.
“The total yarn production is expected to rise by 6.8 per cent during the year against 5.9 per cent estimated earlier,” the Centre for Monitoring Indian Economy (CMIE) said in its monthly report.
The cotton yarn output is expected to grow by 10 per cent in 2012-13 and synthetic yarn production is likely to grow by three per cent, it said.
Fabric production grew at a healthy pace for the fourth consecutive month ended July at 9.9 per cent driven by rise in production of cotton and hosiery fabrics.
The cumulative cloth production was increased by 14.3 per cent during April-July.
“We expect the total fabric output to grow by 7.1 per cent against 5.7 per cent estimated earlier. The growth is expected to be led by an 8.1 per cent increase in the output of cotton fabric,” the CMIE said.
The country’s apparel exports are estimated to fall by two per cent in FY13 due to decline in volumes following weak global economic conditions, the CMIE said.
Weak economic growth expected in the two largest export destination for the Indian apparel industry — Europe and the US, along with continued deterioration in the country’s competitiveness in apparel exports compared to neighbouring countries is expected to impact the export volumes.
However, it said, during this period of sluggish demand manufacturers are exploring markets in the Middle East, Latin America and Africa.
Also, it further said, recently signed free trade agreement with Israel is expected to boost apparel exports going forward.
These factors will help in restricting the fall in exports volumes to 2.3 per cent in 2012-13, it said.