The Vibrant Ceramic Expo held in November 2017 may be considered as a turning point in the history of ceramics exports from India. It has provided a great platform for unorganised players to directly connect with importers from across the globe. Increased capacity in Morbi has been able to survive partly due to strong demand from abroad for Indian tiles. Many players in unorganised sector are focusing on this segment which has lessened the pressure on domestic supply.
In Financial Year 2017, Morbi recorded an export of Rs 6200 crore thus accounting for 22% of Morbi’s total production. In FY 2018 exports from the region saw a jump of 77% reaching Rs 11,000 crore accounting for 34% of the total product of tiles in Morbi.
One of the factors that have contributed to the increased exports from India is the China made ceramic tiles turning costlier in recent years partly due to increased cost of production due to increased wage cost. Also, in recent years several countries have imposed anti-dumping duties on Chinese tiles thus making tiles import from that country costlier and uneconomical. India, the second largest tiles maker in the world is taking full advantage of the situation which is visible in its surging exports of tiles. Saudi Arabia is the biggest market for Indian tiles followed by Iraq, UAE and other Gulf countries. Nearly 75% of its tiles exports are to Asian countries.
Another advantage playing in favour of Indian exports is that Chinese players mainly manufacture using double charge and soluble salt method but Morbi players have expertise in GVT and printed tiles. Further, India has more SKU’s (stock keeping units) than China whereas China has less SKU’s but higher scale.
However, road is not smooth ahead for Indian ceramic exporters in the coming days. For example, the Gulf Cooperation Council (GCC) has decided to impose a temporary anti-dumping duty on Indian tiles in the new year. GCC has imposed anti-dumping duty of 15% for six months on Indian tiles from 5th Jan’19 onwards. Nearly 35% of ceramic exports from Morbi cluster is to the Gulf countries.
Morbi ceramic manufacturers export their products to 150 countries which include traditional ceramic producing countries such as Spain, Italy, Mexico, Brazil and Turkey. Interestingly, some players have also bagged export order from China in recent months.
Morbi, located in Gujarat, is probably the second-largest tile cluster in the world after Foshan in China. It houses 600-700 units, which produce all types of tiles, from the basic ceramic floor and wall tiles to the most sophisticated PVT/GVT tiles. While most manufacturers are unorganized small-and medium-scale units, a few have formed joint ventures with larger branded players while few have been successful in creating their own brand.