NEW DELHI: India needs to reduce import tariffs on synthetic fabric if it wants to double apparel exports from the current USD 15 billion to USD 30 billion, according to Praveen Chakravarty, Chairman of the Professional Congress, in a letter sent to Finance Minister Nirmala Sitharaman.
In the letter, titled "Proposals to Boost Garment Exports and Create One Crore New Jobs", Chakravarty argues that the current skewed import tariff structure on synthetic fabrics of 20 per cent is hurting India’s apparel exports tremendously.
“The top five apparel importing countries America, Germany, Japan, France and Britain buy 70 per cent synthetic garments and 30 per cent natural fabric apparel. But India exports more natural fabrics and less synthetic garments,” the letter states.
The letter also suggests that a special collateral-free credit scheme linked to exports for textile and apparel makers would be more impactful in scaling garment exports quickly and significantly than a scheme like the Production-linked Incentive (PLI) scheme.
The letter which is also addressed to Dr Anantha Nageswaran, Chief Economic Advisor to the Government of India, further says India should sign free trade agreements with the European Union, United Kingdom and America for textile exports to compete with Bangladesh that receives preferential duty treatment from these nations as a Least Developed Country (LDC).
Quoting estimates from NITI Aayog, the letter states that every USD 1 billion of garment exports creates 1.25 lakh direct and five lakh indirect jobs, with 70 per cent of these jobs benefiting women.