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EXPORT PROSPECTS OF SILK SILK BASED PRODUCTS

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EXPORT PROSPECTS OF SIILK EXPORT PROSPECTS OF S LK

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SIILK BASED PRODUCTS S LK BASED PRODUCTS

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ericulture in India is an important cottage on of industry agro earning foreign It in is more

based source valuable exchange. practiced

forestry and is a good

than 60,000 villages providing employment to over 60 lakh people who hail from the weaker section of the society. India continues to be the largest importer and consumer of raw silk despite the fact that it is the second largest producer. The country has unique distinction of producing all the four varieties of silk- mulberry, eri, tassar and muga. Raw silk is obtained from two sources: silk worms and mulberry plants. Both silk worms and mulberry plants play cardinal roles in the production of raw silk. The Indian Silk Export Promotion Council supported by the Ministry of Textiles, Government of India since its inception in 1983 has been engaged in promoting and

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regulating export of natural silk goods, on the one hand, and building up India’s image as a reliable supplier of high quality silk goods such as: fabrics, made-ups, readymade garments and machine made carpets, on the other. For providing up-todate information to its members, it is bringing out a journal named ”SILKNET”. The Central Silk Board (CSB), another government agency, established in 1949 as a Statutory body under Government of India is a national organization for overall development of sericulture and silk industry. Its headquarter is located in Bangalore. The programmes for development of the sericulture industry are primarily formulated and implemented by the State Sericulture Departments. However, the CSB supplements the efforts of the states by providing necessary support for research, development, extension and training through its countrywide network of units as well as jointly with the state sericulture departments. Besides, the above stated nodal agencies, Silk Mark Organization of India (SMOI) promoted by Central Silk Board has been plying an important role in popularising the usage of the “Silk Mark” logo. The “Silk Mark” scheme was launched in June 2005 as a consumer awareness progrmme on certifying the genuineness of quality silk. The SMOI has so far enrolled 183 members from the trade including manufacturers and retailers. India’s exports mainly comprise of dress materials, readymade garments, sarees and made-up articles for interior decoration (e.g. bed spreads, cushion covers, curtains and carpets, etc.) Though India is the second largest producer of raw silk in the world and biggest importer of raw silk, its share in the global silk export trade still continues to be insignificant. India is producing around 16,500 tonnes of raw silk whereas the demand is around 26,500 tonnes. Major silk producing states in the country comprise: Karnataka, Tamil Nadu. Jammu & Kashmir, Jharkhand, Uttar Pradesh, and Mizoram. The sericulture industry today is faced with numerous problems which are creating hurdles in boosting production. These inter alia include (i) Continuous rise of prices of

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raw silk and cocoons. According to the industry circles, the prices have gone up by more than 40 per cent in 2005.

Recent Developments
(i) Development of World’s First Natural Colour Silk Technology India has developed a new technology through which natural colour silk yarn could be produced, the first of its kind in the world. Talking about the new technology, Dr. Sankar Dandin said that the country has succeeded in developing this technology to produce coloured silk without using any dyes. This technology, he added, is set to provide India yarn and an opportunity to tap new global silk markets. Currently, synthetic colour across silk the these user-friendly allergy and To overcome the scientists Central Research Institute fibre dyes are used to world. Many of colours are not and create skin other these attached Sericulture and Training ailments. problems, to

(CSRTI) has developed this technology through which natural colour cocoon eggs can be produced. At present, the CSRTI has technical know-how to produce three silk yarns in three colours—yellow, red and blue. It is now trying for all colours. With this new technology, Indian silk materials with natural colour shades are likely to hit the world silk marketing in the near future. (ii) Technology Mission for Silk: The Central Silk Board is preparing a Blueprint for setting up of a National Technology Mission for Silk on the lines of Cotton Technology Mission for modernizing the country’s sericulture sector. It has been holding discussions in this respect with various state governments. (iii) Future Plans of CSB: Highlighting recently various schemes of the Central Silk Board (CSB), Mr. Hanumanthappa, President, and Central Silk Board disclosed that the CSB has several plans to promote sericulture (http://www.fibre2fashion.com/news/silk). He said that the Board provides subsidy for mulberry plantation, fertilizers, laboratory

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research, marketing, etc. He also stated that the CSB has a project lined up worth Rs. 183 crore of which Rs. 68 crore is to be spent on research and technology and Rs. 112 crore for development grants. In the light of the past performance of Indian silk industry, Mr. Hanumanthappa, was quite optimist and said that India will be selfreliant in silk by the end of 11th Five Year Plan.

(iv) Thrust Sectors on Sericulture: The Department of Biotechnology, Government of India in association with Central Silk Board has identified several thrust areas in sericulture (both mulberry and nonmulberry) where biotechnology can play a vital role in increasing productivity, enhancing quality and improvements of host plants. So far 60 R&D projects have been supported. Out of these, 13 projects were jointly funded with Central Silk Board. The Department has also initiated molecular biology studies on silk proteins and diseases on non-mulberry silkworms such as muga, eri and tropical tassar. Import of raw silk In order to meet the growing domestic and overseas demand of its silk and silk

goods like blouses, shirts, dresses, sarees, etc, India imports a variety of silk and silk based products such as raw silk, silk yarn, silk waste and silk worm cocoons mainly from China. In 2004-05, as may be seen from Table 1, the country imported silk related goods of the value of Rs. 1,381.37 crore as against Rs. 1,173.37 crore in the previous year, registering an increase of 17.73 per cent. Raw silk, woven fabrics, and yarns constitute the major items of imports. The items registering a steep growth during the period included: Silk yarns (other than yarn spun from silk waste) not put up for retail sale (73.83%), and Woven fabrics of silk and silk waste (39.70%). On the other, items registering a steep decline included: Silk-worm cocoons suitable for reeling (66.67%), and Silk waste (including cocoons not suitable for reeling, yarn waste (41.40%).

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TABLE 1 INDIA’S IMPORTS OF SILK & SILK GOODS IN 2003-04 & 2004-05 (Rs. crore)
HS Code

Item

2003-04

2004-05

%change in 2004-05 over 2003-04

5002 5007 5004

Raw silk Woven fabrics of silk and silk waste Silk yarns (other than yarn spun from silk waste) not put up for retail sale

628.41 402.23 102.53

607.21 561.92 178.23

(-)3.37 39.70 73.83

5006

Silk yarn & yarn spun from silk waste put up for retail; sale, silkworm gut

14.47

15.97

10.37

5005 5003 5001

Yarn spun from silk waste not put up for retail sale Silk waste (including cocoons not suitable for reeling, yarn waste Silk-worm cocoons suitable for reeling TOTAL (ALL INDIA)

10.67 15.00 0.06 1,173.37

9.23 8.79 0.02 1,381.37

(-)13.50 (-)41.40 (-)66.67 17.73

Source: Compiled from the data of DGCI&S, “Monthly Statistics of India’s Foreign Trade”, Volume II—Imports, March 2004 and 2005 issues, Kolkata.

Global Scenario (i) World Production: World production of raw silk and waste in 2003, as may be seen from Table 2, registered a marginal increase of 0.70 per cent over the previous ear win the same reached a level of 1,42,000 tonnes as against 1,41,000 tonnes in the previous year. China continues to be the largest producing country of raw silk and silk waste. Other producing countries comprise India, Vietnam, Turkmnsistan, Thailand, and Brazil.

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TABLE 2 World production of raw silk & waste by major countries in 2002 & 2003 (Tonnes) Country China India Vietnam Turkmenistan Thailand Brazil Iran Japan Uzbekistan WORLD TOTAL 2002 1,00,000 17,000 12,000 4,000 2,000 2000 1,000 1,000 1,000 1,41,000 2003 1,02,000 17,000 12,000 4,000 2,000 2002 1,000 1,000 1,000 1,42,000 %change in 2003 over 2002 2.00 0.70

Source: FAO, “Production Yearbook", Rome.

(ii) World Imports: World imports of silk in 2003, as may be seen from Table 3, registered a growth of 7.19 pr cent over the previous year when the same reached a level of 28,810 tonnes as against 26,877 tonnes in the previous year. Further, a glance at the table reveals that India continues to be the largest importer of silk. In 2003, it imported silk to the tune of 9,359 tonnes as against 9,266 tonnes in the previous year. The other major importing countries during the period comprised: China, Italy, Japan, Korea Rep and Germany. The countries showing a steep increase in their imports during the period constituted: China (63.88%), Vietnam (59.74%) and Germany (35.90%). On the other hand, the countries showing a steep decline in their imports during the period comprised: France (55.81%), Thailand (40.92%), Egypt (21.29%), and Korea Rep (19.20%).

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TABLE 3 World imports of silk by major countries in 2002 & 2003 (Tonnes) Country India China Italy Japan Korea Rep Germany Thailand Romania Vietnam Egypt Bangladesh France WORLD TOTAL %change in 2003over 2002 9,266 9,359 1.00 2,766 4,533 63.88 3,498 3,687 5.40 2,853 2,852 (-)0.03 2,108 1,704 (-)19.20 1,209 1,643 35.90 1,107 654 (-)40.92 560 520 (-)7.14 303 484 59.74 512 403 (-)21.29 400 706 312 (-)55.81 26,877 28,810 7.19 Source: FAO, “Trade Yearbook”, Rome. 2002 2003

(ii) World Exports: World exports of silk in 2003, as may be seen from Table 4, registered a decline of 9.20 per cent when the same reached a level of 27,935 tonnes as against 30,767 tonnes in the previous year. India, as may be seen in the table, emerged as the ninth exporting country. However, its exports during the period drastically fell to 341 tonnes from 962 tonnes, registering a decline of 64.55 per cent. The other countries showing a steep decline in their exports during the period comprised: USA (83.69%), Australia (65.14%), and Uzbekistan (37.97%). On the other hand, the countries showing a steep rise in their exports during the period comprised: Vietnam (91.79%), Korea Dem. Rep ((74.12%), and Brazil (25.68%). TABLE 4 World export of silk by major countries in 2002 & 2003 (Tonnes) Country China Turkmenistan Vietnam Germany Japan Italy Uzbekistan Brazil India 2002 17,842 4,010 560 835 116 636 898 331 962 2003 17,264 4,010 1,.074 964 684 640 557 416 341 %change in 2003 over 2002 (-)3.24 91.79 15.45 489.66 0.63 (-)37.97 25.68 (-)64.55

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Korea Dem. Rep Australia USA WORLD TOTAL 170 740 1,410 30,767 296 258 230 27,935 74.12 (-)65.14 (-)83.69 (-)9.20

Source: FAO, “Trade Yearbook”, Rome.

INDIA’S EXPORTS (i). India’s Exports---Categorywise: India’s exports of silk based products, as may be seen in Table 5, registered a marginal growth of 3.89 per cent when the same reached a level of Rs. 2,747.68 crore as against Rs. 2,625..53 crore in the previous year. The natural silk yarn, fabrics, made-ups continues to be the major category of exports, and had accounted for a share of 66.35 per cent of the total exports of silk and silk based products exports in the year 2004-05. Other major categories of exports during the period constituted: Readymade garments made of silk, silk carpet, and Silk waste. The category of silk waste recorded a steep decline of 79.03 per cent when the same fell to Rs. 5.34 crore from Rs. 15.76 crore during the period.. TABLE 5 Categorywise India's exports of silk goods from India in 2003-04 & 2004-05 (Rs. crore)
Item 2002-03 2003-04 2004-05
%change in 2004-05 over 2003-04

Natural silk yarn, fabrics, madeups Readymade garments made of silk Silk carpet Silk waste TOTAL (ALL INDIA)

1,504.35 (65.97) 664.01 (29.12%) 96.13 (4.22) 15.76 (0.69) 2,280.25 (100.00)

1,739.96 (66.27 760.01 (28.95) 120.22 (4.58) 5.34 (0.20) 2,625.53 (100.00)

1,823.06 (66.35) 800.94 (29.15) 122.56 (4.46) 1.12 (0.04) 2,747.68 (100.00)

4.78 5.39 1.95 (-)79.03 3.89

Note: Figures within brackets indicate percentage shares of the total.

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Source: Compiled from the data of DGCI&S, “Foreign Trade Statistics of India (Principal Commodities & Countries)”, March 2005, Kolkata. Detailed data on exports of select silk based products in the years 2003-04 and 2004-05 appear at Annexure 1. (ii) India’s Exports—Countrywise: As may be seen from Table 6, USA continues to be the largest market for Indian silk based products. The other major export markets in the year 2004-05 comprised: UK, Italy, Germany, UAE, Spain and Hong Kong. The markets registering a phenomenal growth in 2004-05 over the previous year comprised: Belgium (54.46%), Saudi Arabia (43.17%), Italy (41.14%), and UK (21.87%). On the other, the markets showing a steep decline during the period comprised: UAE (37.43%), Kuwait (33.98%), and Singapore (19.87%). TABLE 6 India's exports of silk goods to major markets in 2003-04 & 2004-05 (Rs. crore) Market USA UK Italy Germany UAE Spain Hong Kong Saudi Arabia Singapore Canada Belgium Japan Kuwait Australia TOTAL (ALL INDIA) Source: Compiled from the data of DGCI&S, “Foreign Trade Statistics of India (Principal Commodities & Countries)”, March 2005, Kolkata. 2003-04 790.60 208.70 144.84 164.60 233.82 115.84 157.62 61.52 96.69 39.87 22.77 22.86 27.78 10.87 2,625.53 2004-05 836.65 254.34 204.42 161.32 146.29 146.12 140.48 88.08 77.48 44.83 35.17 24.33 18.34 12.27 2,747.68 %change in 200405 over 2003-04 5.82 21.87 41.14 (-)1.99 (-)37.43 26.14 (-)10.87 43.17 (-)19.87 4.96 54.46 6.43 (-)33.98 12.87 3.89

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Categorywise India’s exports of silk based products to major markets in the years 2003-04 and 2004-05 and exports of silk based goods in the select markets in the years 2003-04 and 2004-05 appear at Annexures II and III.

Export Strategy Silk and silk base exports from the country offer tremendous potential. However, for tapping the full potential, there is a need to formulate a suitable export strategy. Some of the points which may merit attention of the policy makers in this respect include: (i) Image-building in overseas markets A number of market studies have underlined the need for building up a good image abroad for Indian goods. There is thus an urgent need to launch an image-building campaign in select markets. (ii) Greater participation in fairs For a breakthrough in other major markets, participation in the fairs organized therein is an obvious must. global silk industry. (iii) Boosting production of raw silk India is importing every year a huge quantity of raw silk and silk yarn. Vigorous efforts need to be made to boost production of raw silk with the adoption of new technologies (iv) Market surveys To keep pace with the new innovations and developments taking place in the world, there is need to undertake indepth studies in the major markets to study their demand pattern. The Indian Institute of Foreign Trade can play an important role to this end. There is an imperative need to conduct such studies from time to time. Participation in these fairs will provide the industry with greater exposure to the latest developments taking place in the

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ANNEXURE I Itemwise exports of select silk goods in 2003-04 & 2004-05 (Rs. crore) HS Code Item 2003-04 2004-05 %change in 2004-05 over 200304 50.07.2090 Items other than saris containing >85% by weight of silk etc. 50.07.2010 Saris containing >=85% by weight of silk or of silk waste other than noil silk 63.04.9910 Silk cushion covers 62.14.1090 Shawls, scarves, etc (exceeding 60 cm) of silk, others 62.04.4911 House coats & like dresses of silk 50.07.1000 Woven fabrics of noil silk 62.04.5910 Skirts of silk 62.06.1010 Women/girls blouses, shirts & short-blouses of silk 62.01.1910 Carcoats, capes, cloaks & similar articles of silk 62.04.6911 Trousers bib etc \of silk, embroidered 63.04.1920 Bed spreads of silk 50.06.0021 Silk embroidery thread containing >=85% by weight of silk 62.04.3919 Jackets & blazers of silk 62.05.9010 Men’s or boys shirts of silk 63.04.9110 Silk belt 62.03.4910 Trousers, breeches and like of silk 63.03.9910 Silk shower curtains 62.08.2910 Night dresses & pajamas of silk 21.93 4.07 8.32 6.90 (-)62.06 69.53 14.65 15.05 8.45 8.73 12.18 8.42 8.37 8.32 (-)16.86 (-)44.05 (-)0.95 (-)4.70 17.39 5.75 14.49 13.91 (-)16.68 141.91 13.15 14.80 12.55 5.04 17.58 248.81 54.98 29.16 69.49 53.43 44.62 18.07 (-)2.82 53.02 (-)74.00 67.34 63.37 (-)6.04 62.04 57.28 85.07 70.75 37.12 23.52 386.34 365.79 (-)5.32 827.34 944.23 14.13

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62.02.1910 Coats of silk 62.04.2911 Costumes of silk 62.04.1919 Suits of silk 50.02.0010 Mulberry raw silk 62.03.3910 Jackets & blazers of silk 63.02.4010 Table linen of silk, hand knitted/crocheted TOTAL (ALL INDIA) 2,625.53 2,747.68 3.89 1.44 3.50 7.86 3.60 18.01 1.07 6.10 5.82 5.75 4.84 4.54 4.17 323.61 66.29 (-)26.84 34.44 (-)74.79 289.72

Source: Compiled from the data of DGCI&S, “Monthly

Statistics of India’s

Foreign Trade”, Exports & Re-Exports, March 2004 and 2005 issues, Kolkata. ANNEXURE II Categorywise India's exports of silk goods in 2003-04 & 2004-05 Category/market Natural silk yarn, fabrics, made-ups USA UK Hong Kong Italy Germany Spain UAE France Canada Belgium Total (incl others) 555.04 125.16 118.82 90.88 98.11 74.49 165.02 50.26 28.96 14.01 1,739.96 584.03 149.39 132.41 126.29 113.58 100.04 69.98 52.57 30.29 25.21 1,823.06 5.22 19.36 11.44 38.96 15.77 34.30 (-)57.59 4.60 4.59 79.94 4.78 2003-04 2004-05 %change in 200405 over 2003-04

Readymade garments made of silk USA UK 196.93 73.26 210.64 96.52 6.96 31.75

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Italy UAE France Saudi Arabia Singapore Canada Netherlands Denmark Australia Japan Kuwait Malaysia Total (incl others) 51.02 66.15 34.33 22.70 23.01 9.02 22.68 5.90 8.84 9.92 6.56 6.30 760.01 (28.95) Silk carpet USA Category/market Germany UK UAE Japan Italy Netherland Australia Oman Singapore Canada Kuwait Switzerland Total (incl others) 38.67 2003-04 33.13 10.27 2.60 0.39 2.30 0.93 2.03 1.29 1.76 1.88 1.73 1.85 120.22 41.98 2004-05 14.06 8.38 3.54 2.51 2.36 2.32 1.86 1.47 1.32 1.30 1.21 1.01 122.56 8.56 %change in 200405 over 2003-04 (-)57.56 (-)18.40 36.15 36.15 2.61 149.46 (-)8.37 13.95 (-)25.00 (-)30.85 (-)30.06 45.41 1.95 75.71 72.57 46.91 45.36 13.59 13.12 11.19 11.08 10.41 10.12 8.84 8.02 800.94 (29.15) 48.39 9.71 36.64 99.82 (-)40.94 45.45 (-)50.66 87.80 17.76 2.02 34.76 27.30 5.39

Silk waste Thailand 1.34 0.77 (-)42.54

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UAE Italy Total (incl others) TOTAL (ALL INDIA) Source: Compiled from the data of DGCI&S, “Foreign Trade Statistics of India (Principal Commodities & Countries)”, March 2005, Kolkata. ANNEXURE III Categorywise India's exports of silk goods in select countries in 2003-04 & 2004-05 (Rs. crore) Category 2003-04 2004-05 %Change in 2004-05 over 2003-04 USA Natural silk yarn, fabrics, made-ups Readymade garments made of silk Silk carpets Total UK Natural silk yarn, fabrics, made-ups Readymade garments made of silk Silk carpets Silk Waste Total ITALY Natural silk yarn, fabrics, made-ups Readymade garments made of silk Silk carpets Silk Waste Total GERMANY Natural silk yarn, fabrics, made-ups Readymade garments made of silk Silk carpets 98.11 33.34 33.13 113.58 33.68 14.06 15.77 1.02 (-)57.56 90.88 51.02 2.30 0.64 144.84 126.29 75.71 2.36 0.06 204.42 38.96 48.39 2.61 90.63 41.14 125.16 73.26 10.27 0.01 208.70 73.26 96.52 8.38 0.05 254.34 (-)41.47 31.75 (-)18.40 400.00 21.87 555.00 196.93 38.67 790.60 584.03 210.64 41.98 836.65 5.23 6.96 8.56 5.82 0.05 0.64 5.34 2,625.53 0.20 0.06 1.12 2,747.68 300.00 (-)90.63 (-)79.03 3.89

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Silk waste Total UAE Readymade garments made of silk Natural silk yarn, fabrics, made-ups Silk carpets Silk Waste Total TOTAL (ALL INDIA) 165.02 66.15 2.60 0.05 233.82 2,625.53 72.57 69.98 5.79 3.54 0.20 146.29 2,747.68 36.15 300.00 (-)37.43 3.89 (-)56.02 0.02 164.60 161.32 (-)1.99

Source: Compiled from the data of DGCI&S, “Foreign Trade Statistics of India (Principal Commodities & Countries)”, March 2005, Kolkata.

G.P. Gandhi C-1/1065, Vasant Kunj New Delhi-110070 Note: The author has used various references in the preparation of this article. For further details please contact him.


				
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