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1. Indian Handicrafts - An IntroductionA walk through the time-honored gallery of Indian handicrafts showcases the cultural
brilliance and munificence of the nation. Emblematic of a country that is a melting pot of
diverse communities, customs, tribes, traditions, festivals and languages, the lineage of
Indian handicraft dates back to antiquity and captures a rich blend of functionality with
artistic ingenuity. Infusing prolific designs on timeless substrates like textiles, stone,
metal, papier mache, glass, grass, wood, cane, bamboo, clay, terracotta and ceramics,
they beautifully articulate the artistic mastery and excellence of Indian crafts persons who
have inherited, preserved and honed this ancient skill throughout the ages. Today,
globally extolled for their dynamic combination of form, design and color,
Indian handicrafts enjoy a large export market, especially in places like Saudi Arabia,
U.S.A. Japan, U.K, Germany, Canada, Italy, France, to name a few.
1.1. Popular Indian Handicraft Items
Metal Craft: Metals such as gold, silver, copper, brass and bell metal are shaped to
perfection to create an exquisite wealth of jewellery, figurines, idols, utensils, etc. These
intricately crafted items are special to Bihar, West Bengal, Kashmir, Orissa, Assam,
Tamil Nadu and Kerala.
Metal Ornamentation: Use of techniques such as inlay, overlay, appliqu, etc., gives
birth to the exclusive repertoire of metal ornamentation in India in the form of Bidri a
kind of surface ornamentation relived with silver and gold inlay, and Enamelingan
artwork where surfaces of various metals are subjected to color treatment and etchings.
Pottery & Stone Craft: A distinguishable variety of utilitarian and decorative products
are fabricated by potters and craftsmen of Alwar, Bikaner, Jaipur, Kutch, Saurashtra,
Kangra, Meerut, Hapur, Khujra, etc., under this handicraft category.
Stone Craft & Marble Inlay Work: Stones in different shapes, sizes and colors are
sculpted, inlaid and polished to produce an artistic range of utensils, statues, candle
stands, medicine grinders, lampshades, etc. This craft is extensively practiced in Bihar,
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2. Handicrafts Export Markets In IndiaLabor-intensive in nature, the Indian Handicrafts and Gifts Industry is a major revenuegenerator of the country providing employment opportunities to more than 6 million
craftsmen throughout India. Today it enjoys a strong presence in the world market with a
turnover of USD 1.9 billion. It has also shown a consistent annual growth rate of more
than 15 per cent over a period of 10 years, with a steep rise from a mere 3.6% to a 10%
share in global handicraft exports. Major Indian states that contribute to exportation of
various handicraft items are Andhra Pradesh, Uttar Pradesh, Rajasthan, and Gujarat.
Moreover, popular handcrafted gift items manufactured and marketed from India
includes vases, candle stands, Christmas ornaments, pen stands, brassware, papier mache
gift items, ceramic pots and handmade paper products in matchless variety and designs.
2.1.Country-Wise Export of Indian CraftsMajor buyers of Indian handicrafts are
TABLE:1
Art Metal wares U.S.A., Germany, U.K. & Italy
Wood Wares U.S.A., U.K., Germany & France
Hand Printed & Textiles & Scarves U.S.A., U.K. , Germany & Canada
Embroidered & Crocheted Goods U.S.A., Saudi Arabia, U.K., Germany
Shawls as Art wares Saudi Arabia, U.S.A. Japan & U.K
Zari & Zari goods U.K. U.S.A., Japan & Saudi ArabiaImitation Jewelry U.S.A., U.K., Saudi Arabia & Germany
Miscellaneous Handicrafts U.S.A., Germany, U.K. & France
Source:www.india-exports.com
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2.2.Art Concentration AreasA comprehensive range of handicrafts and gifts products is made all over India. Although it isquite difficult to limit a particular place for a specific craft, the following places are well known
for their unique crafts.
TABLE:2
Art MetalwareMoradabad, Sambhal, Aligarh, Jodhpur, Jaipur, Delhi, Rewari,
Thanjavur, Madras, Mandap, Beedar, Kerala, Jagadhari and Jaselmer
Wooden Artwares
Saharanpur, Nagina, Hoshiarpor, Srinagar, Amritsar, Jaipur, Jodhpur,
Jagdalpur, Bangalore, Mysore, Chennapatna, Madras, Kerala &
Behrampur (WB)
Hand printed Textilesand Scarves
Amroha, Jodhpur, Jaipur, Farrukhabad, Sagru & Sanganer
Embroidered GoodsKutch (Gujarat), Jaisalmer, Baroda, Lucknow, Jodhpur, Agra, Amritsar,
Kullu, Dharmshala / Chamba & Srinagar
Marble & Stone Craft Agra, Madras, Baster and Jodhpur
Terracotta Agra, Madras, Baster, and Jodhpur
Zari & Zari Goods Rajasthan, Madras and Baster
Papier Machine Craft Kashmir and Jaipur
Artistic Leather
Goodslndore, Kolhapur and Shanti Niketan (WB)
Imitation Jewelry Delhi, Moradabad, Sambhal, Jaipur and Kohima (Tribal)
Source:www.india-exports.com
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2.3.COUNTRYWISE EXPORTS DATA OF HANDICRAFTS (EXCLUDING HANDKNOTTED CARPETS) FOR THE YEAR 2010-11
TABLE:3
` in Crores Increase/
Decrease in %
over 2009-10
US $ in
Millions
Increase/
Decrease in %
over 2009-10
S. NO. COUNTRY 2009-
10
2010-
11
2009-
10
2010-
11
1 AUSTRALIA 117.30 146.11 24.56 24.62 31.92 29.66
2 CANADA 248.13 301.54 21.53 52.09 65.88 26.48
3 FRANCE 386.60 468.99 21.31 81.15 102.47 26.27
4 GERMANY 782.57 947.35 21.06 164.27 206.98 26.00
5 ITALY 294.58 361.77 22.81 61.84 79.04 27.82
6 JAPAN 201.65 243.76 20.88 42.33 53.26 25.82
7 NETHERLAND 248.70 305.11 22.68 52.21 66.66 27.68
8 UAE 517.99 633.57 22.31 108.73 138.43 27.31
9 SWITZERLAND 121.26 148.94 22.83 25.46 32.54 27.81
10 U.S.A. 2489.19 3012.45 21.02 522.52 658.18 25.96
11 U.K. 928.06 1123.32 21.04 194.81 245.43 25.98
12 LAC 144.56 181.15 25.31 30.34 39.58 30.45
13 OTHER
COUNTRIES
2238.35 2659.90 18.83 469.86 581.15 23.69
TOTAL 8718.94 10533.96 (+) 20.82 1830.23 2301.52 (+) 25.75
Source: Export Promotion Council for Handicrafts
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3. ANALYSIS OF THE FOREIGN TRADE POLICY 2009- 2014ANNOUNCED ON 27.08.2009 WITH REFERENCE TO
HANDICRAFTS EXPORTS
Foreign Trade Policy 2009-2014 was announced by Honble Minister of Commerce and
Industry on 27th
August, 2009. The major highlight of the FTP is placed at Annexure I. A
special thrust has been given to labour intensive handicrafts sector which is witnessing job losses
in wake of the recession. A brief analysis on the provisions made in the new FTP in particular
with the handicraft sector are placed below:
PROVISIONS SPECIFIC TO HANDICRAFTS SECTOR
1. Three handicrafts clusters provided status of Towns ofExport Excellence (TEE) (NewProvision) Jaipur, Srinagar & Anantnag have been announced as Towns of Export
Excellence for the handicrafts sector. This would enable upgradation of infrastructure and
would provide incentives and focus support.
2. All handicrafts exports to be treated as Special Focus Products and entitled to 5% dutycredit scrips as per S. No. B (vi) (g) of the new Foreign Trade Policy. (New Provision
covering all items of handicrafts however, a limited number of items were earlier
covered under VKGUY) All handicrafts exports would now be treated as Special Focus
Products and entitled to higher incentives as per Sl. No. 3.15.2. Special Focus Products
covered under Table 2 & Table 5 of Appendix 37D, shall be granted duty credit scrip
equivalent to 5% of FOB value of exports for exports made from 27.08.2009 onwards.
3. 52 items added to the New Special Focus Products list.
EPCH had requested the inclusion of 103 items in the New Special Focus Products list
to DGFT and followed it vigorously through Ministry of Textiles. The efforts have
yielded quite good results and 52 items have been notified as New Special Focused
Products.
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These 52 items appears in Table No. 4 & 5 of Appendix 37D of the new Handbook Book
of Procedures Vol-I. They shall be entitled to duty credit scrips of 5%.
The handicraft items not elsewhere specified elsewhereare now also eligible under NewSpecial Focus Products scheme as per entry No. 43 of Table 5 of Appendix 37D of
Handbook of procedures. Earlier only selected items were eligible for the same. This
entry will cover all new and innovative handicrafts items.
Export Promotion Council for Handicrafts shall now certify that the exported product is a
handicrafts product, if any doubt arises.
4. EPCG at zero custom duty for Technological Upgradation.
The recommendation of EPCH to reduce the custom duty on EPCG (Export Promotion
Capital Goods) from 3% to 0% has been accepted.
Now EPCG shall be available at 0% custom duty for handicrafts sector .The export
obligation shall be six times of the custom duty saved to be fulfilled in six years. The
scheme shall be in operation till 31.03.2011.
5. Status holder to get duty credit scrip.
To accelerate exports and encourage technological upgradation, additional Duty Credit
Scrips shall be given to Status Holders @ 1% of the FOB value of past exports. The duty
credit scrips can be used for procurement of capital goods with Actual User condition.
This facility shall also be available for handicrafts. This facility shall be available
upto31.3.2011.
All status holders will get duty credit scrips at the rate of 1% of the value of past exports.The duty credit scrips can be used for procurements of capital goods but subject to actual
user condition.
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6. Support for Green products and products from North East
Focus Product Scheme benefit extended for export of Green Products; and for exports
of some products originating from North East.
7. MDA/MAI
Higher allocation for Market Development Assistance (MDA) and Market Access
Initiative (MAI) schemes is being provided. Special funds have been earmarked for the
handicrafts sector.
GENERAL PROVISIONS MADE IN FTP INCLUDING HANDICRAFT
8. Focus Market Scheme - 26 new markets have been added under Focus Market Scheme.
These include 16 new markets in Latin America and 10 in Asia-Oceania.
The incentive available under Focus Market Scheme (FMS) has been raised from 2.5% to
3%.
9. Market Linked Focus Product Scheme (MLFPS) - Market Linked Focus Product Scheme
(MLFPS) has been greatly expanded by inclusion of products classified under as many as
153 ITC (HS) Codes at 4 digit level. Some major products include; Pharmaceuticals,
Synthetic textile fabrics, value added rubber products, value added plastic goods, textile
made ups, knitted and crocheted fabrics, glass products, certain iron and steel products
and certain articles of aluminium among others. Benefits to these products will be
provided, if exports are made to 13 identified markets (Algeria, Egypt, Kenya, Nigeria,
South Africa, Tanzania, Brazil, Mexico, Ukraine, Vietnam, Cambodia, Australia and
New Zealand).
10. DEPB - To impart stability to the Policy regime, Duty Entitlement Passbook (DEPB)
Scheme is extended beyond 31-12-2009 till 31.12.2010.
DEPB rate shall also include factoring of custom duty component on fuel where fuel is allowed
as a consumable in Standard Input-Output Norms.
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11. Import of Samples - To facilitate duty free import of samples by exporters, number of
samples/pieces has been increased from the existing 15 to 50. Customs clearance of such
samples shall be based on declarations given by the importers with regard to the limit of
value and quantity of samples.
12. EDI - To further EDI initiatives, Export Promotion Councils/Commodity Boards have been
advised to issue RCMC through a web based online system. It is expected that issuance
of RCMC would become EDI enabled before the end of 2009.
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4.Research methodologyProblem Statement:
Estimation of export of Indian handicrafts industry
Research Objectives
To analyze the provisions made in the Foreign Trade Policy in particular with thehandicraft sector.
To know the future trend of the total export of handicrafts. To find out the increase or decrease in the export of Indian Handicraft products from the
last years data.
Research Design
Descriptive Research
Data Collection Plan
The researcher has made use of secondary sources like internet, websites, journals etc to get the
required data.
Statistical tools
Trend analysis is used by the researcher to estimate the future exports of handicrafts.
Data Analysis Plan
Trend analysis
Benefits of the Study
1. It will give estimation about the future export of an Indian Handicraft2. It will analyse the foreign trade policy with regards to Indian Handicrafts
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Limitations of the Study
1. This research study is based on the data of 10 years of export of Indian Handicrafts i.e.short time so proper/accurate estimation in not possible.
2. This research work is confined to only Indian handicrafts. So we cannot generalize theresult to other exports.
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5. DATA ANALYSIS:
5.1.EXPORTS OF HANDICRAFTSThe export of handicrafts (other than hand knotted carpets) was merely Rs. 387.00 crores
during the year of establishment of the Council i.e. 1986-87 rose to level of Rs. 10533.96
Cores in year 2010-11.
(Rs. in Crores)Source: Export Promotion Council for Handicrafts
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5.2.TREND ANALYSISTABLE:4
Year Total export X X^2 XY
2000-01 8490 -5 25 -42450
2001-02 7709 -4 16 -30836
2002-03 9844 -3 9 -29532
2003-04 10465 -2 4 -20930
2004-05 13032 -1 1 -13032
2005-06 14527 0 0 0
2006-07 7288 1 1 7288
2007-08 14012 2 4 28024
2008-09 8183.12 3 9 24549.36
2009-10 8718.94 4 16 34875.76
2010-11 10533.96 5 25 52669.8
total 112803.02 0 110 10626.92
Trend line: y= a. x+ b--------------------------------- 1
Sum of y=a. sum of x+n. b---------------------------2
Sum of(x.y)=a.Sum of (x.x)+b.Sum of x-----------3
Equation (3)
10620.92=a(110) + b(0)
10620.92=a(110) + 0
a=96.55
Similarly, in equation (2)
112803.02=a(0) + 11(b)
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112803.02=0 + 11(b)
b=10254.82
Trend line:
Y=a.x+b
Y=96.55(x) + 10254.82
If suppose x=0
Y =10254.82
If suppose y=0
0=96.55(x) + 10254.82
X = 106.21
Estimated for 2011-12:
Y =96.55(x) + 10254.82
=96.55(6) + 10254.82
=10834.12
Estimated for 2015-16:Y =96.55(x) + 10254.82
=96.55(10) + 10254.82
=11220.32
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5.3.Estimated dataFollowing table shows the estimated sales data of past 10 years, which has been found out using
the trend line only so as to get a clearer trend line and making it clearer to compare between the
actual and the estimated data.
TABLE: 5
Year Estimated sales (Rs. in Crores)
2000-01 9772.07
2001-02 9868.62
2002-03 9965.17
2003-04 10061.72
2004-05 10158.27
2005-06 10254.82
2006-07 10351.37
2007-08 10447.92
2008-09 10544.47
2009-10 10641.02
2010-11 10737.57
2011-12 10834.12
2012-13 10930.67
2013-14 11027.22
2014-15 11123.77
2015-16 11220.32
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TREND LINE
INTERPRETATION:
The intercept in the total export of an Indian Handicraft is 96.55 and slope is 10254.82. The
intercept is the value of the line when X equals zero and b the slope and the slope quantifies the
steepness of the line. It equals the change in Y for each unit change in X. In the export of an
Indian Handicraft the slope is negative which indicates the positive or upward trend in the export
of an Indian Handicraft. It is a good sign from the countrys economic point of view From the
available data the estimated or forecasted export of Indian Handicraft in 2011-12 is
Rs.10834.12crores
0
2000
4000
6000
8000
10000
12000
14000
16000
estimated
actual
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6. Findings & ConclusionFindings
It is seen that the exports are showing a fluctuating trend. The exports of handicrafts aregradually increasing since 1994-95 to 2000-01, from RS.3160 crores to Rs.8490 crores.
After the slight decrease in 2001-02, the exports have again boosted up and have reachedthe peak in the year 2006-07 with exports of Rs.17288 crores.
Because of the recession during the years 2007-08 and 2008-09 the exports have shown adownfall.
After the implementation of Foreign Trade Policy 2009-14, and various export promotingschemes, the exports have shown a upward trend and it very near to the estimates in this
financial year.
So from the fluctuation of exports, trend of Indian handicraft industry is growing. Thus,from the trend analysis the researcher can say that export of handicraft is going to
increase in upcoming years if all other factors remains the same. Though it is seen that
there is vast difference between the estimated values and the actual values of the exports.
Conclusions
The Indian handicraft industry is of major importance with respect to Indian economy as it will
help in generating more employment at lower costs. Moreover, labour is in abundance in India
and hence effective use of manpower can be made. More foreign exchange can be earned thus.
Hence such a industry can be a growth booster to the economy of a developing country like
India. So various steps should be taken by government for upliftment of such industries and thus
developing the economy at large.
Thus in a changing world scenario, crafts products exported to various countries from a part of
life style products in international market. The impact is due to the changing consumer taste and
trends. In view of this, it is high time for Indian Handicraft industry to go into the details of
changing designs, patterns, product development, requisite change in production facilities for a
variety of materials, production techniques, related expertise to achieve a leadership position in
the fast growing competitiveness with other countries.