Secretary General, Joint Apparel Association Forum (JAAF), Sri Lanka, Yohan Lawrence has said that the country can increase its annual apparel export revenue by a minimum of US $ 500 million if Sri Lanka is allowed to export more items to India.
The Indian Government in 2013 had removed the fabric requirement and the port restrictions and eight million pieces were permitted to be used for exports.
“However items like a pair of gloves or a pair of socks are also counted as two pieces and not as one and Sri Lanka is at a disadvantage due to this,” said Lawrence.
Apparel manufacturers from the country have successfully entered the Indian market and in the last few years, the quota of 8 million pieces has been used. Additionally, several Sri Lankan companies have made their presence in many key malls in India, targeting high and middle-end consumers as well as having international brands shipped to India from local manufacturers.
“Unfortunately, the limit of 8 mn pieces of quota restricts Sri Lanka’s ability to grow its exports to India as there is more than triple the number of inquiries to export local apparel to India” said lawrence
“If more exports are allowed we could earn around USD 500 million from the Indian market alone. At present, the industry is on a 30% YoY dip due to damped demand with the trend expected to last well into the second half of 2023. Under these circumstances we expect the SME sector to be hit hardest and placing at risk a significant portion of the 350,000 workers who are directly employed by the sector” he added.
Export trade between India and Sri Lanka has multiplied 18 fold due to the India-Sri Lanka Free Trade Agreement (ISFTA) in 2000, rising from US $ 47 million in 1999 to US $ 815 million in 2021
“However the apparel industry could not get significant benefits from this due to export restrictions,” said Lawrence.
Despite several rounds of discussions between the countries, with Sri Lanka urging India to remove the apparel quota under the ISFTA ,the response has not been encouraging, added Lawrence.
