Going by the recent records, the textile industry in India may not be vocal in consultations being held by the Department of Commerce on sensitive products for free trade agreements (FTA), especially with the European Union (EU) and European Free Trade Association (EFTA) countries. However, according to United Nations Conference on Trade and Development (UNCTAD), the lack of responses from the industry players is a strong indicator of growing level of confidence among them.
"Increasingly, the Indian textile industry is becoming confident of its position globally and feeling less threatened of imports from other countries like those from EU and EFTA. This is evident through a lack of response from industry players in the recent consultations that have been held on sensitive products. They are now in a better position to tackle competition from duty-free imports from other countries," said Rashmi Banga, senior economist of UNCTAD, during one of such consultations here recently.
Talking about sensitive list of products for FTAs, DK Nair, secretary general of Confederation of Indian Textile Industry (CITI) said, "We don't need any textile products on the sensitive or negative list for FTAs and that is why we had abstained from being so responsive. Also, we had been demanding zero per cent import duty as our competitors like Bangladesh, Vietnam and others enjoy such benefits. Plus, we are now sure that our exports to these countries will exceed imports from them. The industry is definitely improving amidst slowdown."
According to CITI, around 17 per cent of yarn exports from India goes to EU countries, apart from 20 per cent of Indian fabrics and 40 per cent of total garments exports. "In all, the total Indian textile exports amount to $ 17 billion of which 35 per cent go to EU countries," Nair added.
Apart from the newfound confidence, the industry also plans to make use of the FTA for importing technologically advanced and specialised products to augment the indigenous ones. "In general, the Indian textile industry is not facing much problems anymore. No other country has as much raw materials for the textile industry as India has. By not suggesting any products on negative list, the industry is encouraging these countries to opt for a zero import duty trade. Thereby, technologically advanced and specialised products can be imported to augment the locally produced products," said Chandan Chatterjee, general manager, Industrial Extension Bureau (iNDEXTb), Government of Gujarat. However, the Department of Commerce has still called for feedbacks and inputs on sensitive or negative list of products.
"Feedback from industry on sensitive products is necessary for firming up India's negotiating position on FTA with EU and EFTA countries, and industry has to come forward with their inputs," observed Ajay Srivastava, director, Department of Commerce, Government of India.
