MUMBAI: The Indian
textile industry, which was hit hard by the global economic recession,
is all set to witness a recovery in 2010, barring
cotton textile exporters who may face another challenging year, global
rating agency Fitch said on Wednesday.
“There
are clear signs pointing towards a recovery in India’s textile industry
in 2010… The recovery will be supported by a pick-up in export
demand, government stimulus, improved liquidity, and a
stable-to-growing domestic demand for textile products,” Fitch said in
its report ..The sector had witnessed over 2 per cent decline in exports at about $20 billion in FY’09 compared with the previous fiscal ..While
capacity to repay loans of domestically-focused and synthetic textile
companies are expected to improve, cotton textile exporters could face
another challenging year, as their capacity to repay loans has been
more severely impacted by recession and may take longer to recover, the
report said ..Fitch said demand fundamentals remain strong in the
domestic textiles sector, but spending by consumers will remain
value-driven, leading to pressures on the margins ..Fitch
presented contrasting picture for export earnings of textile sector as
export revenues are likely to improve this calendar year due to revival
of demand overseas, but appreciation of the Rupee will hit these
exports ..Meanwhile, the rating agency came out with an index to
track the collection efficiency of asset based securities, backed by
commercial vehicle loans .
Date:2/22/2010
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