The new Textile Minister K. S. Rao today said the Government has set an ambitious export target of $50 billion this fiscal, hoping realisation of the target will help in containing the high current account deficit.
“CAD is affecting the nation’s economy and the textiles sector is one sector where we can increase exports substantially,” Rao told presspersons after taking charge of the Ministry.
“I am given to understand that our textiles exports is about $34 billion today, which I wish to make at least $50 billion by end of the current fiscal,” Rao said.
This will help in containing CAD, he added.
The current account deficit, which is the difference between inflows and outflows of foreign exchange, touched a record high of 6.7 per cent of GDP in the December 2012 quarter.
It is likely to be around 5 per cent in the 2012-13 fiscal.
Faced with weak demand in global markets such as the US and Europe, textiles exporters are making efforts to increase their presence in emerging markets such as Latin America, Africa and Japan.
The US and Europe together account for almost 65 per cent of the country’s textile exports.
For reviving the sector’s growth, Rao said, there is a need to encourage skill development.
“When people are skilled, production will go up, the cost of production will come down, the sector will grow, which in turn will help it to compete in the international market,” he said.
Besides, he said, he would be holding consultations with industry to find out issues affecting their growth so that their problems could be addressed.
Talking about cotton prices, Rao said: “Cotton growers claim that they do not get a remunerative price for their produce. So, I wish to concentrate on how to increase the output per acre and ensure that whenever the cotton crop is in substantial quantity, farmers should be permitted to export before it enters the hands of traders.”
He also laid emphasis on reducing the role of middlemen in the entire value-chain.
The textiles industry employs about 4.5 crore people. The 69-year-old Rao, a strong advocate of united Andhra and a Lok Sabha member from Eluru constituency of Andhra Pradesh, took over as the Minister for Textiles.