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Bangladesh surpasses India in knitwear exports
Oct '11
Bangladesh has surpassed India to become the second largest knitwear exporter in spite of the country buying yarn from India at a premium. High cost of labour, energy and water are taking a toll on Indian knitwear industry though the country has a good raw material base.

In 2005, both India and Bangladesh had around 2.5 percent market share in global knitwear trade. But, since then Bangladesh progressed to overtake India and emerge as the second largest knitwear exporter after China. Currently, China's knitwear exports account for 33.5 percent of the world market.

In T-shirt exports, Bangladesh is ranked first globally, while India is placed fifth. In exports of kidswear, Bangladesh occupies second position compared to India's fourth place. Similarly, in case of exports of cardigans and pullovers, Bangladesh is at second position as against India's tenth.

The knitwear industry in Bangladesh operates under both small and large units. The small units have around 100 stitching machines on an average, while the large units house around 1,000 stitching machines. In addition, contract labour is allowed in Bangladesh. In contrast, the cost of labour, energy and water is higher in Indian knitwear clusters of West Bengal and Tirupur.

In fact, Tirupur knitwear cluster is currently under crisis due to the closure of processing units from January this year. As a result, some manufacturing units have opted to outsource their wet processing operations to other States in the country like Punjab and Gujarat, resulting in a two-fold increase in their dyeing costs. This has also affected the export competitiveness of Tirupur knitwear cluster.

The cost advantage enjoyed by Bangladesh would also enable the country to supply its garments to India at a cheaper price. The recent increase of the quota-free export limit to 10 million garment pieces from Bangladesh to India will further boost Bangladesh's knitwear exports to India. This would further affect the Indian knitwear industry.

Fibre2fashion News Desk - India

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