`Utilise growing demand for handicrafts'

By Our Special Correspondent

TIRUCHI, FEB.23 . Indian handicrafts have a constant growing demand in the foreign countries and this market need to be further exploited with good quality, huge quantity and timely execution of export order, the Assistant Director, Office of the Development Commissioner (Handicrafts), Union Ministry of Textiles, A. M. Abdul Khader, said.

Delivering his inaugural address at the two-day seminar on `how to start exporting handicrafts and documentation procedures,' organised by the Small Industries Product Promotion Organisation (SIPPO) Limited here on Sunday, he said the export potential of handicraft products was always more compared to other products from India. The country's export of handicrafts stood at Rs. 8,343 crores last year, compared to Rs. 1,970 crores, recorded a decade ago.

Though handicraft export industry faced stiff competition from countries like China, Taiwan, Korea, Indonesia and Philippines, the export of the Indian handicrafts was still a promising field because of its uniqueness in terms of traditional and historical popularity.

Referring to the favourable and conducive market for Indian handicrafts, Mr. Khader said countries like USA, Germany, Britain, Italy, France, Japan, Australia and Saudi Arabia were the major importers of Indian handicrafts. India accounted for 1.25 crore artisans producing handicrafts worth about Rs. 30,000 crore, of which goods worth Rs.11,000 crores were exported. The country's handicraft exports accounted for 37 per cent of the total production.

He said the people of the developed countries had a special affinity towards Indian carpets, hand printed textiles, hand embroidered, tie and dye textiles, artistic metal products, bronze icons, utility oriented brass items, have good demand in the foreign market.

Mr. Khader said eco-friendly handicraft products have taken a lead present. Hence the handicrafts made of natural fibres are in good demand. This was one sector where the concerns from Taiwan, Indonesia and Philippines were competing with the Indian firms, he said and called upon the craftsmen to concentrate on bulk manufacture of the same.

The Member (south zone), Khadi and Village Industries Commission (KVIC), S. Rajagopal, emphasised the need for taking special initiative to identify the proper export markets and explained the precautions to be taken and procedures to be followed for retaining the same. As there was good demand for group products, compared to single product, the craftsmen should concentrate on them.

Mr. Rajagopal said the exporters should know the quality specifications and the specific demands of the buyers.

The Foreign Trade Development Officer from the Joint Directorate of Foreign Trade, Banu, and the Executive Officer of the Export Credit Guarantee Council, K. Rajendran, spoke.

According to the nodal officer of the SIPPO, Neelavalli, over 50 artisans from 20 districts were participating in the seminar.

Indian Handicrafts and Gifts

India is one of the major exporter and supplier of handicrafts and gift products to the world market. The Indian handicrafts industry is highly labor intensive and decentralized, being spread all across the country in rural and urban areas. The sector is considered as the second largest employment-generating sector after agriculture with numerous artisans engaged in craft work on a part-time basis. The industry offers employment to over 6 million artisans, including a large number of women and people from the weaker sections of society.

The present day handicraft tradition of India is a perfect example of assimilation between the traditional designs and modern techniques. The fast growing demand for Indian handicraft and gifts products have made this sector a full-fledged large scale organized industry that is growing day by day.

HistoryThe rich history of India’s craft tradition has evolved over the centuries offering a legacy of Indian culture promising everything - beauty, dignity, form and style. The variety is comprehensive and ranges from age-old stone carvings to modern handicrafts making use of glass flints and mirrors. The most popular crafts, include metalware, earthenware, pottery, sculpting, woodwork, hand- printed textiles and scarves, embroidered and crocheted goods, shawls, zari products, stone carving and imitation jewelry.

There is a myriad of art and craft traditions in India that depend on social, economic and regional factors. The present status of the sector in India owes much to the rich crafts history and tradition of the past. Majority of the crafts from the past continues to flourish due to their utilitarian characteristics, availability to the common people and popularity in domestic and global markets.

Today, some of the sectors within the craft industry have even become full fledged industries in their own, like - carpet weaving, traditional textile (Banarsi silk sari,

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Chikankari etc), gem cutting and polishing, jewelry making, the world famous diamond cutting and polishing industry, brassware, jute products, etc. The growth of these industries is due to their ever-increasing demand and the popularity of Indian crafts in the domestic market and overseas. Gems and jewelry, carpet making, metalware, leather products, jute products etc. are some industries, which are growing rapidly.

ExportsGenerally considered a cottage industry, Indian Handicrafts and Gifts Industry has outgrown its image to evolve into a rapid growing industry with a turnover from US $ 1.2 million to US$ 1.9 billion in the last decade. There has been a consistent annual growth rate of more than 15 per cent over a 10-year period, from 3.6% to a respectable 10% share in global handicraft exports. In 2005-2006 the exports of Indian handicrafts has shown an increase of US$ 298.87 million, i.e. the exports increases by 10.02% over the similar period during 2004-2005. Though India's share in international handicrafts market is just about 2 %, the world handicrafts market is estimated to be of the order of US $235 billion. The industry is expected to triple its export turnover to Rs. 39,000 crore by 2009-10 that in turn will also create around 20 lakh new job opportunities.

Top Ten Destinations of India's Export for Handicrafts

Rank Country Name2000 - 2001 Value (In Million US$)

2001 - 2002 Value (In Million US$)

2002 - 2003 Value (In Million US$)

1 U S A 294.8517 219.176 324.6047

2 U K 61.6174 56.1987 79.1673

3 Germany 37.554 30.4357 47.2585

4 France 31.013 29.4103 37.5341

5 Netherlands 29.243 25.8394 37.3164

6 Spain 21.8287 19.0162 30.4608

7 Italy 27.9376 19.89 24.0536

8 U A E 14.6376 12.205 20.9196

9 Canada 15.2344 12.8124 17.6554

10Belgium-Luxembourg

9.0019 9.5755 14.5125

Source: DGCI&S

Export Data (Product Wise) 2006-07According to the provisional data available, the export of handicrafts has shown an increase of Rs. 2761.29 crores, from Rs.14, 526.85 to Rs.17, 288.14 crores (increase of 19.01% in rupees term). In dollar terms, the export figures have shown an increase of US$ 528.70 millions, i.e. the exports increased by 16.11% over the similar period during 2005 - 06. Details are given below –

STATEMENT PRESENTING PROVISIONAL EXPORT FIGURES OF HANDICRAFTS DURING THE PERIOD APRIL- MARCH 2006 - 07 COMPARED TO THE CORRESPONDING PERIOD OF APRIL- MARCH 2005 - 2006.

ItemsRUPEES IN CR. (April-March)

INCREASE IN % OVER 2005-06

US$ IN MILLIONS (April-March)

INCREASE IN % OVER 2005-06

INCREASE IN % OVER 2005-06

2006-072005-06 *44.2546

2006-07 *45.3607

Artmetal Wares

3662.98 4135.06 12.89 827.90 911.60 10.14

Woodwares 853.06 1180.02 38.33 192.76 260.14 34.96

Handprinted Textiles

2053.70 2465.18 20.04

464.07 543.4617.11

& Scaraves 4711.45 5860.35 1064.62 1291.94

Embroidered &

110.23 216.82 24.39

24.91 47.80 21.35

Crocheted Goods

347.05 392.45 78.42 86.52

Shawls as Artwares

274.86 386.09 96.70 62.11 85.12 91.89

Zari & Zari Goods

2513.52 2652.17 13.08 567.97 584.68 10.33

Imitation Jewelry

14526.85 17288.14 40.47 3282.56 3811.26 37.05

Misc. Handicrafts

    5.52     2.94

Total 19.01 16.11

US$ at the rate of Major Importers of Indian Handicraft Products (2004-05) (Source – Export Promotion Council for Handicrafts)

Products ExportedThe items, which account for a major share of export turnover, include - art metalware, woodware, hand-printed textiles, hand-knotted and embroidered textiles, leather goods, stoneware, paintings and sculpture, jewelry and antique & collectibles.

With 26 states, 18 languages and more than 1500 dialects, the country offers an enormous range of handicrafts from different states and regions. Major production centers are, in Uttar Pradesh - Moradabad also known as the "Peetalnagari" (City of Brass), Saharanpur for its wooden articles, Ferozabad for Glass. The North-Western state of Rajasthan is known for its Jaipuri quilts, Bagru and Sanganer printed textiles and wooden and wrought iron furniture. The coastal state of Gujarat offers famous embroidered articles from Kutch. Narsapur in Andhra Pradesh is known for its Lace and Lace goods. But all this is only a small portion of total product range. The country offers much more.

Country-Wise Export of Indian Crafts

Major buyers of Indian handicrafts are

Art MetalwaresU.S.A., Germany, U.K. & Italy

   

Wood WaresU.S.A., U.K., Germany & France

   

Hand Printed & Textiles & Scarves

U.S.A., U.K. , Germany & Canada

Embroidered & Crocheted U.S.A., Saudi Arabia, U.K.,

Goods Germany

Shawls as ArtwaresSaudi Arabia, U.S.A. Japan & U.K

Zari & Zari goodsU.K. U.S.A., Japan & Saudi Arabia

Imitation JewelryU.S.A., U.K., Saudi Arabia & Germany

Miscellaneous HandicraftsU.S.A., Germany, U.K. & France

Art Concentration AreasA comprehensive range of handicrafts and gifts products is made all over India. Although it is quite difficult to limit a particular place for a specific craft, the following places are well known for their unique crafts.

Art MetalwareMoradabad, Sambhal, Aligarh, Jodhpur, Jaipur, Delhi, Rewari, Thanjavur, Madras, Mandap, Beedar, Kerala, Jagadhari and Jaselmer

Wooden ArtwaresSaharanpur, Nagina, Hoshiarpor, Srinagar, Amritsar, Jaipur, Jodhpur, Jagdalpur, Bangalore, Mysore, Chennapatna, Madras, Kerala & Behrampur (WB)

Hand printed Textiles and 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 Goods

lndore, Kolhapur and Shanti Niketan (WB)

Imitation Jewelry Delhi, Moradabad, Sambhal, Jaipur and Kohima (Tribal)

Future ProspectsThe dynamism of handicrafts industry in India is unparalleled - be it the traditional Indian arts and crafts or a customized version of an overseas art form. Unlike in the past when the industry was battling to carve a niche in the market, there is a great demand for Indian handicrafts today that is being nurtured by different government and non-governmental organizations.

The sector is economically important from the point of view of low capital investment, high ratio of value addition, and high potential for export and foreign exchange earnings for the country. The export earnings from Indian handicrafts industry for the period 1998-99 amounted to US$ 1.2 billion.

The market is developing due to the huge demand of its products in terms of utility, cost and aesthetics. To centralize and better organize the sector, the government has also initiated the concept of 'Towns of Excellence' that are providing recognition to production areas where the handicrafts have been traditionally developed. Today, there are 35 urban 'Haats' all across the country, that allow for the allotment of built-up stalls to artisans on a fortnightly rotation basis at nominal costs.

The industrial revolution and the increasing productivity had slowed down the growth and the quality of arts and crafts, but for some decades now, the scenario has changed and machine-made products no longer attract the people. Presently handicrafts are being considered as vocational media and it is also opted for style statement and the leisure pursuit. Today, the crafts and craftspeople have a vital role to play in modern India – not just as part of its cultural and tradition, but as part of its economic future.

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Handicrafts represent a region's traditional art heritage and legacy of customary craft skills. Metal ware, pottery, sculpting, textiles, stone crafts, jewelry and much more - India's rich cultural ethnicity has made Indian handicraft products a rage in the national and international markets.

Economically, the labor intensive Indian handicraft industry has evolved as a major contributor to India's export revenues, with an industry growth rate of 20% pa. US and Europe together account for over 65 per cent of the Indian handicrafts exports. The recession hit the Indian handicrafts industry majorly, bringing down the handicraft exports revenue to half. Quoting in figures, 2008-09 handicraft exports stood at US $ 1.79 billion. Export Promotion Council for Handicrafts, hopes to recover the loss in the fiscal year 2009-10.

The major strengths of the Indian handicrafts are it's cheap and abundant labor, low capital investment and the quintessential uniqueness of these crafts, since most of them are handmade. All these characteristics give Indian handicrafts a competitive edge in terms of prices and distinctiveness. Skilled Indian artisans have consistently adapted and evolved to successfully meet demands of the still- growing industry. Considering the current scenario of the worldwide handicraft industries, India needs greater technological infrastructure, innovation, better distribution channels and consolidation of the various big and small artisans, craftsmen and larger business units.

The Indian handicraft industry is concentrated in the rural and suburban areas and provides employment to over six million artisans, most of them being women. Rising demand in the west,

prestige value attached to antique handicrafts and the emergence of e-commerce and Internet have been instrumental in driving the growth of the Indian handicraft industry.

Associations and OrganizationsGovernment Bodies associated with the development of Indian handicrafts and their export and import.

Exim PolicyKnow about the export import policy of the Government regarding the much in demand Indian handicraft products.

Export BenefitsList of special drawback duty offered by government of India on Indian Handicraft products.

Export Promotion CouncilsThese bodies act as a link between the Indian craftsmen and foreign importers, providing a common platform.

Foreign Import OfficesAddresses of foreign offices encouraging the import of handicrafts from other countries and a list of the services offered by them.

Product ClassificationStandard Industry classifications and Harmonization System Codes for proper categorization of products as per international standards.

Trade ShowsComplete information on National and International trade shows on Indian gifts and handicrafts

Private Handicraft Promotion AssociationsThe rhythm of Indian art thrives, as people from different parts of India come together celebrating the joy of Indian traditions.

SWOT ANALYSISStrengths:1. Indian Handicrafts Industry has a diversified and potential market in domestic & international platform.2. It provides large product variety and range as it is full of diversified culture.3. Industry is facilitated by diversified and supportive retail infrastructure acros the country.4. Industry provides srvices to different market (Handicrafts, Textiles, Jwelry) bcaue of

diversified product range.5. Labor rates are cheap and it results to competitive price.6. Industry needs low capital investment.Low barriers for new entry in market.7. Industry provides potential sources of employment. 8. Products are high value added, and handicrafts have various applications. 9. It is the potential source of foreign revenue because of higher export. 10. Industry provides potential sources of employment. 11. Products are high value added, and handicrafts have various applications. 12. It is the potential source of foreign revenue because of higher export.

Weaknesses:1. Industry is lacking with infrastructure and communication facilities. 2. There is unawareness among craftsmen about international requirements and market. 3. Lack of co-ordination between government bodies and private players. 4. Inadequate information of new technology and developments.5. Inadequate information of current market trends. 6. There is lack of skilled labor in indutry. Industry is still confined to rural areas and small cities and not able to reach untapped market. 7. There is lack of promotion of products.

Opportunities:1. Emerging demand for handicrafts goods in developed countries such as USA, Canada, Britain, France, Germany, Italy etc. 2. Rising demand and usage of handicrafts products in fashion industry.3. Development of sectors like Retail, Real Estate that offers great requirements of handicrafts products. 4. Developing of domestic and international tourism sector. 5. e-Commerce and Internet are emerged as promissory distribution channels to market and sell the craft products.

Threats:1. Competition in domestic market. 2. It is challenge to have balance between high demand and supply of products.3. Quality products produced by competing countries like China, South Africa. 4. Competing countries are offering better Trade Terms . 5. Competing countries are offering better technological support and R&D facility in competing countries.

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Achilles Heels of the Industry:

 

Despite of all the technological advancements happening globally, there is still a lack of awareness about it in this sector. The artisans do not have awareness about the new technologies. They do not get adequate details about the current market trends. Further more; they lack information regarding international requirements and market scenario. Hence they are not able to commercialize their skills in the right way. Though Indian made handicraft items have a healthy demand in the global market, lack of adequate infrastructure and communication facilities hinder the marketing activities.

 

Moreover, there is very less co-ordination among government bodies, and private players. They sector still remains under nourished with young people not much interested in this craftsmanship. The industry is confined to small cities and rural areas with the market remaining untapped.

 

The Dark Phase:

 

There is no adequate balance between demand and supply. The industry faces a tough competition with handicrafts from countries like China, and South Africa. The advanced technology and R&D in the competitors countries favor them whereas; its absence in India makes the industry to wobble behind. This has ultimately resulted in loss of skilled workmanship in the sector.

 

Due to lack of support from the Handicrafts Development Corporation, and the Government, many skilled artisans are leaving the handicraft industry. The artisans feel that the corporation is not interested in supporting them to market the goods made by them. Almost 90% of the handicraft items seen in the stalls of Handicraft Development Corporation are machine made. Despite the funds offered under the Deen Dayal Hathkargh Protsahan Yogana (DDHPY) scheme, for promoting handicraft products, no steps have so far been taken for any

projects. Artisans believe that the corporation does not take adequate measures to provide raw materials for their products, which they are selling through the corporation outlets in the past years.

Existing company

Aporv is an interesting startup that brings hand made handicraft online enabling the artisans to sell to a wider audience. An interesting part about Aporv is that the company doesn’t decides on the product price and leaves that for artisans themselves to judge.

Started by IT professionals, Aporv is an attempt to bring the authentic handicraft to wider audience and the team believes in a bit of ‘story telling’ in order to sell the product.

While one would say whats the big deal about a ‘just another ecommerce play’, one needs to understand that this a market where there is a strong demand-supply gap, owing to the distributed nature of the industry.

Read on our interview with the team to understand the concept and the story so far.

a. Tell us about your background and prior experience.

10+ years of corporate life with experience in India, US, China, Taiwan and in my last corporate job I was Sales Director with one of the IT companies in US. I am also the Founder of BITS.aid a volunteering arm of my alma mater, BITS Pilani which gave me exposure to the social sector. Having said that Aporv (www.aporv.com) is a culmination of my interest in creativity, social impact and an opportunity to fill a hiatus I see in the Indian Handicrafts sector.

b. What made you start an *off-beat* ecommerce business like this? What was the trigger?

As I said earlier, it is a culmination of interest and a business opportunity. There are couple of things that triggered this unique model : Aporv (Aporv means Unique in Sanskrit)

1. Our own search to find Indian Handicrafts which are authentic, unique and has a historic significance.

2. My own interest in creativity and looking for new and unique products.3. Understanding the need and trying to fill that gap.4. Lastly and most importantly, making a Social Impact.

After agriculture, handicraft is the second largest occupation in India with more than 23 million people in this sector. Every 7-10 years 10% of these artisans leave their jobs looking for better opportunities. If this continues the Indian Handicrafts will be lost in the next few decades. This is when we decided to take this situation head on and create a unique ‘aporv’ platform. We are bringing 12 differentiations in the sector with our business model, some are targeted towards the uplift of the Indian Handicraft and some towards our appreciators. We believe in bringing value to our appreciators through various means like,

1. Story rather than the product – Our fundamental belief is that given an opportunity we all love to make an educated buy. That’s exactly what we are providing to our appreciators. We bring to our appreciators the story on how the product is made, where it is made and the history of the products which add intrinsic value to the product and provides them the tools to make an educated buy.

2. Authentic products – Our own search led to the conclusion that this is one of the most important point to tackle.

3. Unique artifacts from across India – Where does one go to find Unique Indian Handicrafts which have historic significance. Our answer is www.aporv.com. We bring to our appreciators artifacts from all over India.

4. Open Evaluation – We are trying to revolutionize this sector by opening up the artifacts evaluation by everyone and we call it ‘Open evaluation’. Each artifact on our site can be evaluated on 4 parameters – Skill/ History/ Aesthetics/ Uniqueness.

5. Premium Service – We all would love to get a service that we can think of. Aporv aims to provide you just that. We have a policy if you have an unanswered query for 72 working hrs the mail gets directed to the CEO. Yes, we are that serious with our service.

6. Returns – To build consumer confidence we currently have “No Questions Asked 7 day return Policy” We believe that you should be satisfied with our products else we will be glad to take it back, No questions asked.

c. How do you source inventory? You mentioned that you don’t decide pricing- how does this happens?

Currently we work with individual artisans, Organizations, NGO and SHG’s. Yes, we don’t decide on the pricing with individual artisans. One of our aim is to make these individual artisans entrepreneurs. We let them price their product, the product at which they would like to provide it to Aporv. We also follow fair trade policies and partner with organizations which follow the same. Going forward to make a bigger impact we also plan to invest a percentage of our revenue back to this sector.