Namrata Kath Hazarika | 04 Jun, 2010
Exports from the Indian handicraft sector, which mainly comprises small and medium enterprises (SMEs), have witnessed substantial fall amounting to around 50 percent since 2006-07, said an official from the Export Promotion Council of Handicrafts (EPCH).

Exports of handicrafts in the fiscal 2006-07 was $3811.26 million, which has been decreased to $1830.23 million in the year 2009-10, witnessing a downfall of 49.57% as compared to the financial year 2006-07.

Rakesh Kumar, EPCH Executive Director, said, "Since the global financial crisis, the Indian handicrafts market got adversely affected as demand slowed down extensively from the US and the European markets."

"The small medium enterprises have seen a decrease in their business growth since 2007. The global crisis has tremendously hit the SMEs in handicrafts sector," Kumar said.

At present, handicrafts exporters are trying to tap alternative destination to expand and revive their businesses.  "We are looking for alternative markets such as South America, South Africa, Chile, etc. as demand is excellent in those destinations. They have potential which were not tapped earlier and not even explored in the past years." Kumar opined.

In fact, exports of handicrafts have also witnessed a decrease of 8.66 percent or $330.12 million during 2007-08 and again a slump of 48.35 percent or $1683.26 million during the next year 2008-09. During the last financial year (2009-10), handicraft exports, however, increased but merely by 1.80 percent or $32.35 million.

Kumar also added that although there has been a growth, it is not substantial in volume. And, SMEs are the most affected ones in the midst of the crisis.

Further underscoring views on the rupee appreciation, he said that unstable rupee is costing many SME exporters dearly.

Kumar said, rupee appreciation has affected handicrafts exporters immensely as they usually do not get into hedging and has to bear the loss.

"They (SMEs) are so small that whatever money they get from business deals they be satisfied with the amount and try to cope up with situation," he added.

"We are expecting a growth of 9 to 10 percent in 2010-11 compared to the last fiscal," he added.