Despite the depreciation of the rupee against the dollar, Coimbatore region in the is expected to benefit, however investments in imported machinery for capacity addition or expansion will be affected. Coimbatore region has several industries that are into exports such as textile mills, garment units, foundries, coir and tea sectors. These exporters are able to quote competitive prices to the international buyers because of the rupee depreciation.

Home textiles have good international demand and fabric exports have great potential. However, factors such as high interest rate and tax on fabrics procured by exporters from manufacturers add to the cost, as M Senthil Kumar, former chairman of the Powerloom Development and Export Promotion Council points out. The garment exporters usually have forward contract and hence, they may not get the real benefit. However, it is expected to benefit exporters in their future orders, says an exporter in Tirupur.

“The weaving industry imports looms, especially second hand ones to add production capacities. The high duty on imports and rupee depreciation has made it difficult for the weaving sector to invest in machinery,” Senthil Kumar added.