German recession fallout: Kashmir carpet exporters asked to keep orders on hold

May 29, 2023

SRINAGAR: Top carpet exporter Sheikh Ashiq Ahmad was gearing up to send fresh shipments to Germany when he received a call not to hurry the order. At his wit’s end, he called his dealer in Germany to find out the reason.

“I was told that Germany has entered into a recession and people are saving money. People are not buying luxury items. I was told to stay put till August-September. Later they will review the situation and accordingly, they will let me know about the shipments,” Ashiq told The Kashmir Monitor.

Two consecutive quarters of negative growth have pushed Germany into recession. The German economy contracted by 0.3 percent in the first quarter of this year. In the last quarter of 2022, economic growth fell by 0.5 percent.

“Most of our carpets are exported to Germany. It is the biggest market for our silken carpet. Since GI-tagging, our carpet sector had started showing promise. Now this recession again casts dark shadows on our handicrafts,” said Ashiq, who is the J&K representative in Carpet Export Promotion Council.

Kashmir handicrafts had a good run in the international market despite the Ukraine war last year. Particularly, silken carpets had recorded huge growth. Export figures released by the Handicrafts and Handloom department reveal carpets worth Rs 357.21 crore were exported in 2022-23 against Rs 251.08 crore in 2021-22.

Usually, 50 percent of handcraft exports comprise carpets because of their huge demand in the international market. Nearly 40 percent of exports comprise shawls. crewel and woodcarving. The rest 10 percent comprise other items.

“We had generated momentum in exports. But now for the last one month, our buyers in Germany have asked us to keep all orders on hold. Fresh orders too are hard to come by. Though no order has been canceled, we have been asked to wait and watch for some time,” said Ashiq.

Handicraft exporters fear that if the situation does not get better, the local industry may suffer a lot. “There are many people associated with this trade. If the situation persists, our industry will suffer. Hope this recession ends at the earliest so that we can resume our exports,” said Ashiq.

Director of Handicrafts and Handlooms, Mehmood Ahmad Shah, however, said they will come to know after some months. “We will come to know about it only after a few months,” he told The Kashmir Monitor.

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