RMG exports to India become costly

09 Jan '10

2 min read

As a result of imposition of countervailing duty by India, which came in to effect from October 2009, exports of garments made from cotton and blended or other natural or man-made fibre fabrics from Bangladesh to India is proving to be costlier than in earlier times.

It may be noted here that, presently, Bangladeshi products are entitled to enjoy quota facility under which it can export eight million pieces of clothing duty free to India, though local duties are applicable on these exports.

Duty on cotton garment exported from Bangladesh to India will has increased to 11.8 percent from 8.46 percent and in case of blended and other natural or man-made fibre fabrics it has risen from 19.5 percent from 12.84 percent, due to changes in the tariff.

According to Bangladeshi experts, the Indian authorities have not made it clear whether the eight million pieces of duty-free exports would be exempted from the countervailing duty or not, since it issued a general order imposing the countervailing duty.

The exporters are assuming that the Government of India has imposed these additional duties on pressure from its domestic industry, but they also aver that as per rule they must discuss and conduct hearing before imposing such a duty.

Fibre2fashion News Desk - India

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