Worries galore for Tamil Nadu textile manufacturers! The increasing number of imports from Bangladesh has become a major cause of worry for the garment makers from the industrial clusters of Coimbatore and Tirupur in Tamil Nadu and they have sought the assistance of the Central Government in getting them supply contracts from brands and retailers in India.
The Indian Texpreneurs Federation (ITF), an association of more than 560 textile establishments with a combined turnover of over Rs. 40,000 crore, had written to Textile Minister Smriti Irani in early June, seeking the ministry’s intervention.
The growth in exports has also been slow, which raises concerns as these companies in Tamil Nadu are already facing increasing imports of ready-made garments which are hurting the local markets.
“Indian clusters can better serve the sourcing needs of both Western and Indian brands than products sourced from Bangladesh, Sri Lanka or Indonesia,” the ITF said in the letter to the textile minister.
Not only has the ITF collected data regarding the imports from Bangladesh which have jumped 53 per cent in fiscal year 2018-19 to US $ 1.07 billion (Rs. 7,500 crore) but also, conducted a survey of more than 320 participants in the Indian textile industry.
The results reiterated that India will suffer in the international market due to cost ineffectiveness, narrow focus on target countries and labour shortage.
Apart from this, the local entrepreneurs in Tamil Nadu fear Bangladesh will eat into their market completely due to the advantages they enjoy, such as lower manufacturing costs and free trade agreements (FTAs) that create a duty-free expressway for their products into India.
After the implementation of GST, India had removed a 12 per cent countervailing duty on imports from Bangladesh.