India May Slip In Global Readymade Exports If Govt Reduces Sops
TIRUPUR: India could slip to the 9th position in readymade garment exports behind Myanmar and Ethiopia if the Government failed to provide a helping hand to the exporters about fifty per cent of them based in Western Tamil Nadu town of Tirupur.
From being second largest exporters in the world just behind China 12 years ago India has now fallen to the sixth position in exports behind Cambodia, Vietnam, Bangladesh and Sri Lanka an official of the Tirupur Exporters Association said.
The exporters are of the view that the cut in incentives will reduce the price competitiveness an important element in global competition. The threat of withdrawal of incentives has forced the exporters to go slow on orders.
The textile hub Tirupur accounted for 45 per cent of total exports of readymade garments during the last fiscal and exports touched a figure of Rs 25,000 crores.
The competitors Vietnam, Cambodia and Bangladesh have free trade agreements with European Union, a major destination for the Indian exporters. The exporters are currently looking for more volume of trade from United States and non traditional markets like Eastern Europe.
The exporters resented the Commerce Ministry's latest proposal to slash export incentives including the cutting down the duty draw back scheme from eleven to six per cent.
The move to come into force next month along with the appreciation of the rupee would sound death knell to exporters.
While the exporters from Tirupur have set a target of Rs 35,000 crores during the current financial year, things are not going in the right lines.
Now we are faced with the prospect of reduction in duty draw back. These are not healthy signs for the growth of the industry association sources said.