India agrees to relax fabric sourcing requirement by Sri Lanka

Once the notification by the Government of India is issued, Sri Lanka will be able to export 8 million pieces of readymade garments to India at zero duty under India- Sri Lanka Free Trade Agreement (ISFTA).

Under the existing arrangement under ISFTA, India has granted two sets of apparel quotas at zero duty to Sri Lanka.

This comprises of 3 million pieces without fabric sourcing requirements from India and another 5 million pieces per year, which should be only made of Indian fabrics.

Sri Lanka was able to make use of the 3 million quota fully in the last few years, but was utilising only 10-15% of the quota for the 5 million pieces.

This issue was raised by the Sri Lankan government during the visit of Commerce, Industry and Textiles Anand Sharma to Sri Lanka in August, an Indian High Commission release said today

The decision to provide the facility was conveyed during the four-day visit of a high-level Indian delegation led by Union Textile Secretary Kiran Dhingra to Sri Lanka which ended yesterday, it said.

The twelve-member delegation, comprising officials from the Ministry of Textiles, apparel exporters, spinners, fabric exporters and home textiles manufacturers, held further discussions to enhance bilateral cooperation, the release said.

Necessary approval processes are underway for providing exemption to this condition, it added.