Home / Knowledge / News / Textiles / 'TPP may dent Indian textile exports'
'TPP may dent Indian textile exports'
20
Oct '15
The 12-nation Trans-Pacific-Partnership (TPP) , a duty free trade agreement, may impact the Indian textile and garment export sector negatively and put Indian textile exports of around $40 billion at risk over the medium term, says India Ratings and Research (Ind-Ra).

The TPP member nations led by the US account for 40 per cent of world trade and the deal gives them duty free access to each other, and makes imports from other countries uncompetitive. However the lack of TPP members' backward integration into yarn and fabric will constrain members from taking full benefit and hence limit the negative impact in the short-term. The impact will depend upon how fast these countries are able to set up captive capacities, the Ind-Ra report said.

This may lead to an overall pricing pressure which will weigh down the garment exporters margins. Ind-Ra currently has an overall Stable Outlook for the Textiles Sector.

he key nations out of the 12 countries which India exports textile and apparels to are US, Japan and Canada. The value of India's textile and apparel exports to these three countries stood at $11.5 billion in FY15 which is likely to reduce due to the TPP. India exported $41.4 billion worth of textiles (including raw cotton) out of which $8 billion was apparels in FY15. The US is a key destination for textile and apparel exports, and import duties in that country range between 15 per cent to 50 per cent, depending upon woven or knit textile, or type of raw material used, which can lead to loss of export sales for India, especially detrimental to companies which are exporting majorly to the US. Companies with superior geographic diversification are better placed.

Amongst Asian peers Vietnam would be a key beneficiary of TPP, while India, China, and Bangladesh would be negatively impacted. Vietnam is the second-largest garment exporter in the world with garment exports worth $24 billion in 2014 and would thus be able to increase its textiles export market share strongly to TPP countries by being able to sell at zero duty. However, India has in edge in value added garmenting, which should remain partly insulated due to the lack of readily available similar capabilities in TPP countries. China, with 40 per cent of global apparel capacity ($65 billion exports) is not a part of TPP, which is a breather for India. Also, amongst TPP countries, Vietnam is the only key manufacturer of garments, hence capacity to serve the entire demand will be limited.
 


Must ReadView All

Apparel/Garments | On 26th Jun 2017

GSTN registration reopens

E-commerce operators and TDS (tax deducted at source) deductors can...

Textiles | On 26th Jun 2017

Expedite release of ROSL pending claims: TEA to Centre

The Tiruppur Exporters' Association (TEA) has again urged Union...

Textiles | On 26th Jun 2017

'Export promotion schemes to continue under GST regime'

The export promotion schemes will continue under GST regime, said...

Interviews View All

Abhimanyu Singh Rathore & Barbara Anna Kosiorek
Kannbar

‘Blending cultures is the true beauty of fashion, where one’s imagination...

Rashi Menda
Zapyle

Every fifth sale we make on Zapyle is a repeat purchase

Pratik Bachkaniwala
Palod Himson Machines

Fabric processing machines are picking up

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Suresh Patel
Sidwin Fabric

Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Rupa Sood and Sharan Apparao
Nayaab

Nayaab, an exhibition meant to celebrate Indian weaves, is in its second...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
July 2017

July 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search