India-EU can leverage textile strengths for win-win situation

10 Jul '23

3 min read

Pic: Shutterstock.com

Insights

India and the European Union are negotiating a free trade agreement, focusing on the textile industry.
At the EU-India Leaders Conference 2023, industry leaders discussed utilising their unique strengths, advocating for a zero-duty policy, and resolving barriers to ensure mutual benefits.
The 'early harvest' approach was proposed to expedite progress.

India and the European Union are engaged in discussions regarding a Free Trade Agreement (FTA). Both sides' textile sectors are actively working to carve out an agreement that ensures mutual benefits. Indian textile leaders have advocated for a zero-duty policy and barrier-free bilateral trade. They have emphasised that by leveraging their complementary strengths, both sides can form a powerful supplier block in the global supply chain.

After the EU-India Leaders Conference 2023 held in European parliament in Brussels last week, Sanjay Jain, chairman of the ICC Textile Committee/CMAI North Region and managing director of TT Limited told Fibre2Fashion, “India and EU have unique strengths in the textile Industry. They can turn into a global winner if an FTA is established between them. EU is stronger in technology, design, and brands, while India has its own unique strengths. These strengths can be leveraged for a win-win situation for both.”

The discussions also addressed the hurdles faced by European companies in the Indian market and mapped out a strategy to ensure mutual benefit through the FTA negotiations. EU and Indian industry leaders strongly advocated for the implementation of a zero-duty policy in the proposed FTA, specifically for textiles. There was a call for broader market access for European textile products in India, along with addressing issues related to standards, customs procedures, and misconceptions. The industry proposed the elimination of non-tariff barriers that currently impede European companies in India, such as standards, customs procedures, and information gaps. Jain pointed out that currently, the Quality Control Orders (QCOs) of raw materials pose significant non-tariff barriers for European suppliers.

Industry leaders stressed that policies, especially those related to industry-specific laws, should be harmonised between the EU and India to ensure a level playing field and reduce discrepancies. The panel discussion on EU-India textile cooperation was co-moderated by Dr. Amit Lath, CEO of Sharda Group of Companies, Poland, and Pratik Gadia, CEO of Yarn Bazaar. Esteemed panel members included Sanjay Jain, Dirk Vantghem, director general of EURATEX, Dr. Lalit Shyaam Tekchandani, co-founder of Buffering.in, and Bhadresh Dodhia, chairman of the Synthetic & Rayon Textiles Export Promotion Council and director of Dodhia Group.

In order to expedite progress and foster trust between the EU and India, the conference examined the potential for an 'early harvest' approach. This method would allow for quicker agreements and noticeable results in specific areas, paving the way for increased cooperation and stronger trade relationships. The conference underscored the vital importance of nurturing a robust and cooperative partnership between these regions, with the potential to not only transform the global textile market but also drive change across a range of sectors.

The conference was organised through the collaborative efforts of the Europe India Centre for Business and Industry (EICBI) and Morten Lokkegaard, Member of the European Parliament from Denmark and chair of the European Parliament Delegation for Relations with India. Industry leaders from Europe and India were invited to the European Parliament to discuss the advantages and disadvantages of an FTA in relation to the textile and clothing industry.

Fibre2Fashion News Desk (KUL)

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