India has been pushed to the seventh spot in garment exports to the US by Honduras in July, as exports of clothing from India posted a 16.5 percent fall in the month.
Earlier in 2011, Bangladesh had beaten India in global apparel exports, followed by Vietnam in garment exports to the US that too, earlier this year, while Indonesian clothing exports too are snapping at India’s heals.
Explaining the phenomenon of India dropping back in competition with much smaller countries, the Chairman of Apparel Export Promotion Council (AEPC) said, “Honduras has an agreement with the US which entails duty free exports to that country”.
“While, Indian apparel exports to the US, attract duty between 10 and 40 percent depending on clothing exported. Secondly, Honduras has a low-cost structure in place, while costs are rising in India. All these factors combined have helped Honduras overtake India”, he informed.
According to a big-time apparel exporter from Tirupur, who did not want to be named, “The Chinese export fabrics and other low-value products to Honduras to be stitched into garments, due to its low cost of production. Similarly, many US based retailers have also started production bases.
He added, “Low-value t-shirts and other apparels are mainly produced in mass quantities. These t-shirts and other products can then be exported at a very short notice, which is favourable for the US based apparel retailers too”.
“This is the main reason for the spike in apparel exports to the US from Honduras as the Chinese are taking advantage of duty-free policy as well as delivering in shorter lead times”, he winded up by saying.
Mails sent to the Honduran Apparel Manufacturers Association went unanswered.
Fibre2fashion News Desk - India
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