Exporters body to set up warehouse in US by 2007

With the apparel exports to the United States showing a significant increase in the post-quota regime, the Tirupur Exporters' Association (TEA) plans to set up a warehouse in the US, in collaboration with St John Freight Systems (SJFS), by the end of 2007.

However, the exact investment figures for setting up this facility is not known, but the means of funding would be partly through bank financing and contributions from the members of the association.

The deflection of trade from China to India in the apparel sector has resulted in the growth of India's exports to the US compared to that from China.

Statistics available with TEA indicate that of the total Rs 8,000 crore knitwear exports from Tirupur, the exports to the US stood at 34 per cent (as on March 31, 2006) as against 27 per cent for the corresponding period last year.

"Along with the export-led growth, it becomes necessary for the producers to keep up the delivery schedule of knitwear products and garner more orders," A Sakthivel, president, TEA, told Business Standard.

The setting up of the warehouse will enable knitwear manufacturers to stock their products and deliver them to the chains of stores in the US. The warehouse facility, besides reducing the transshipment time, would benefit the exporters in two ways - in selling the garments and booking more orders from the stores there.

Earlier in September 2005, TEA entered into an agreement with SJFS to set up such a warehouse in Antwerp, Belgium. This will become fully operational by the end of this year.

At present, members of the association could make use of this warehouse facility free of cost and the non-members would be charged a nominal rate, he added.