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'Eurozone crisis double whammy for handicraft exporters'
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Namrata Kath Hazarika | 05 Jun, 2010
The financial storm in Eurozone has certainly been a double whammy for the Indian handicraft exporters as they have been just beginning to heal the injuries of the global crisis that hurted exporters dearly.
"The European crisis is hurting Indian handicrafts exporters. The handicraft products are mostly stored in the departmental stores, and such kind of retail stores are being closed due to financial pressure and slack in demand," said O. P. Garg, an exporter of handicrafts by profession and also the Chairman of Carpet Export Promotion Council (CEPC).
"Around 25 percent US and European markets dealing into handicrafts items have closed their shops due to the recent global financial crisis, and has created serious concern amongst exporters in the Indian handicrafts industry," he said.
Garg also pointed out that there has been a freeze in European nations to stop opening up new stores as of now, which is also an added trouble for Indian exporters in the handicraft business.
Demand for Indian handicrafts like metalware, woodware, hand printed textiles and scarves, zari goods and imitation jewellery saw a massive erosion in the EU markets.
The US and EU together account for over 65 percent of the country's handicrafts exports. The US is the largest buyer of Indian handicrafts and accounts for over 32 percent of total handicraft exports, followed by the EU nations, which account for over 22 percent of the exports.
While, Rakesh Kumar, Executive Director, Export Promotion Council of Handicrafts (EPCH) also opined that the European crisis have hit-hard the handicraft exporters as payment have been ceased out especially from Greece. There are lack of placement of orders from Europe due to the crisis. Orders are not flowing in quantum.
"People have stop placing orders. In fact, the products are dispatched but buyers are delaying and stopping payment dues from Greece," Kumar mentioned.
"There are concern in the handicraft industry and payment default from European nations has spiraled and as handicraft business comprises mostly small and medium enterprises it becomes difficult for them to recover the loss incurred," he said.
"Due to the crisis the Indian handicraft exporters have started looking for alternative markets such South America, Africa, etc, in order to stay in business," Kumar added.
When asked how is demand flowing from those regions, he said, "Demand is picking up and it is good. Demand is excellent in those destinations."
"They have potential which were not tapped earlier and not even explored in the past years." Kumar added.
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