Fig 3: Investment by Sector (US $
million)
(Indian Government Estimate (Ref 3)
|
Over 36% of investments in the Indian
Textile Industry over the next 6 years will be in modernising existing
capacity and creating new capacity in the Dyeing sector.
Dr. B. K. K. Vanavarayar
|
2.5.10 Country Competitive Landscape
The existence of trading quotas in the international textile
and apparel industry has effectively shielded the exports from developed
economies from competition. The quota elimination from January 1st
2005 means that those gloves will be off; and certain countries will be put
at risk.
The countries most at risk will be those which developed
because the quotas held some other counties back. An analysis of US Imports of
apparel by region, (Ref 9), has provided an assessment of risk of loss of
market share.
The risks are categorised as high, medium and low (Fig 2);
and are shown in terms of both US $ million and % of total imports within a
given trading zone.
The analysis shows that countries which have erstwhile
enjoyed competitive exports by virtue of quota free access treaties and
mechanisms (such as AGOA; NAFTA and CBI) will be affected adversely once the
quotas are removed. The quota system restrained growth of market share of Asia
and China.
Similarly, preferential suppliers to Europe are likely to
find similar problems post 2005. Countries with no particular cost or location
advantages (like ASEAN) and countries which have historically enjoyed high
quota holding (like Hong Kong) , will also find a shift in the relative export
volumes which fall into the high risk category.
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