The Indian Texpreneurs Federation has approached the Union government, expressing concern over the serious implications that the Trans-Pacific Trade Partnership would have on the textile and garments sector.
They also urged the government to take a closer look at the situation, exuding fears that this deal will seriously affect India’s garment exports to the US.
In this regard, ITF Secretary Prabhu Damodharan wrote to Commerce Minister Nirmala Sitharaman, pointing out the advantageous position that TPP places exporters from its member countries in the market, pushing non-members like India to a lower ground, particularly affecting the country’s garment exports.
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Last year, US imported apparel, worth US$ 82 billion, of which India supplied about US$ 3.7 billion, accounting for 21.5 per cent of the country’s total apparel exports, down from 23 per cent in 2014. If duty turns disadvantageous for India’s apparel exports, the share is likely to fall substantially, he added.
Speaking on the Yarn Forward Rule (YFR), Damodharan said it has been made mandatory to source yarn, fabrics and other inputs used in making clothes from TPP partner countries only to avail duty preference.
This rule will induce garment manufacturers in TPP countries to source their raw materials from them at the cost of non-TPP countries like India, even if suppliers from that region are not the most efficient, he said.
According to him, India’s exports of apparel, both direct as well as indirect via Vietnam, to TPP countries like the US will go down, since buyers would like to procure from TPP-based vendors only, affecting India’s fabrics and apparel exports.
