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Sees growth opportunities after 2004

AEPC to hold BSM to check falling exports from western region

E-Tex Staff - Mumbai

The Apparel Export Promotion Council (AEPC), western region, is organising a buyer-seller meet in Mumbai, on September 11 and 12, 2003. Around 100 buying agents and buyers’ representatives are expected to attend the meet, which will have participation from around 39 garment exporters.

According to Mr Ashok Rajani, vice chairman, AEPC, western region, "Over the years, garment exports from this region, and especially Mumbai, have fallen. One reason for this could be that the council has not done much export promotion for the western region, concentrating mainly on quota monitoring. So, we have now decided on this initiative, to bring in all major buying agents to Mumbai. Another reason for this BSM is that just about every important buying agent - Walmart, J C Penny, GAP, R H Macy’s, Otto, etc - are based in Delhi, Bangalore, Tirupur. This makes it even more important to invite these representatives to Mumbai, and showcase the region’s capabilities, specialities, etc."

The Union textiles minister, Mr Syed Shahnawaz Hussain, will inaugurate the event. "The changing international buying patterns make it important for garment exporters to closely interact with buyers and their agents/representatives. The prescribed social standards, quality standards, etc are looked into by the agents, who then recommend to their principles, the garmenters who could become reliable suppliers. This entails close and transparent interaction with these agents and representatives," said Mr Rajani. He further informed that leading international buying houses - Walmart, Tommy Hilfiger, Carrefour, J C Penny, GAP, Otto, R H Macy’s, AIE Buying House, etc have been invited to the meet. A fashion show has also been planned as part of the event.

Garment exporters are confident that post-quota regime would lead to increase in exports of garments from India to the US and EU. The AEPC expects a healthy growth after 2005. According to Mr Anees Noorani, managing director, Zodiac Clothing, and committee member, AEPC, "India is facing quite a lot of competition from a number of countries, but it is to be noted that most of this competition is a creation of quotas. For instance, Bangladesh today enjoys duty-free, quota-free access to the EU, imports its fabric requirements from India, converts into garments in its factories, and is able to supply to the EU at least 10 per cent cheaper than India. Such concessions have been granted to almost all SAARC countries, except India, and to a lesser extent Sri Lanka. China is also looked upon as a major threat to India’s garment exports. But there are a number of issues that are in India’s favour. China, a late entrant to the WTO, has had to agree to a cap of 107-108 per cent till 2008, which will hamper its exports after 2004, when tariffs will come down. Moreover, compliance to social standards, labour laws is not very good in China, and these norms will get important post-2004. Heavy subsidies offered by the Chinese government is another issue which will work against the country’s exports."

He further stated that clothing exports from China are subsidised as much as 57 per cent, 17 per cent by way of refund of VAT (which is not paid in the first place) and the remaining through currency manipulations, etc.

Mr Noorani believes another opportunity for Indian garment exporters lies in the commodity business. "This, till now was out of bounds due to quota restrictions. Exporters were exporting at the maximum UVRs they could get, due to the cap on exports, and the commodity business remained untouched, for instance, blended garments, etc, where India has the capability. We have a lot of very good garment factories that can service this segment with quotas on the way out," he said.