Handicraft exports likely to fall 6-8% in FY24 amid global market slump

Indian handicraft exports may witness a 6-8 per cent decline this fiscal to USD 3.3 billion, mainly due to a spending slowdown in global markets, a report said on Monday.

A slowdown in discretionary spending in key global markets will drag the largely export-oriented Indian handicraft industry by 6-8 per cent lower to USD 3.3 billion this fiscal, after a decline of 20 per cent in FY23, Crisil Ratings said in a report.

"Amid the slowdown in key export markets, Indian handicraft exporters will face increased competition from their Chinese counterparts post easing of Covid-19 curbs in China. Handicraft exporters will rely on lower pricing and extended credit to counter subdued demand, which may pull down operating profitability by 200-250 basis points to 12 per cent," Crisil Ratings Director Rahul Guha said.

The industry derives almost 60 per cent of its sales from the US and EU, which are battling high inflation and recession fears.

Together, these two regions make up a market of mor