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‘Give Us Level Playing Ground’ says CMAI Over Uneasy Indo-Bangladesh FTA

Wednesday, July 10, 2019
By A Business Reporter

(L-R) Rohit Munjal, Chairman – CMAI Fair Sub Committee, Suvid Bajaj, Chief Marketing Officer of UDAAN, Rahul Mehta, President – CMAI, Premal Udani, Chairman – Board of Trustees, and Rajesh Masand, Vice President – CMAI.

The India Apparel manufacturing industry’s survival is at stake due to business and finances being affected, even as India continues to provide a beneficial environment to other nations like Bangladesh in the form of zero custom duties on their exports to the country – while Indian manufacturers face a huge net duty of 125% in exports to that country, according to Clothing Manufacturers Association of India (CMAI) officials.

“Give us a level playing ground in our business or such foreign imports growth will cause loss of 10 lakh jobs by 2025 in our industry – which is the biggest job-creating industry after agriculture in India,” came the plea of the Association to the Central Government and Union Minister of Textiles Smriti Irani, while announcing the four-day “69th National Garment Fair” from July 15 in Mumbai yesterday.

Highlighting the forthcoming Apparel Trade Show, Premal Udani, Chairman, CMAI Board of Trustees, said Rs 750 to Rs 800 crores business was expected during the four days through 882 exhibitors with 1062 brands over 7,00,000 square feet space and around 50,000 retailers and trade visitors. Moreover, the show’s popularity could be witnessed in the fact that absence of a larger exhibition space had left 150 manufacturers on the ‘waiting list,’ he said.

“We are raising the ‘red flag’ now as the biggest problem facing us is the unrestricted duty-free imports from Bangladesh -- whose manufacturers import duty-free fabrics from China, converting them into garments and exporting them to India – thus providing duty free access to the Indian market for Chinese fabrics,” Rahul Mehta, President, CMAI, said, adding “Bangladesh to India garment exports growth is 82% over last year and 161% over 2016-17, now reaching US$ 365 million and forecast to grow faster to touch US$ 3.6 billion by 2024-25.”

Describing the GST mechanism as ‘simple and straight-forward,” he said that with a firm, stable government in place now, the industry was expecting positive results in an industry that is not ‘highly-profitable but sluggish.” However, government decision to relax norms of “Local Sourcing for Single Brand Retail” would have negative  on domestic manufacturing, where FDI into this segment would increase as a result of this move,” he said.

Textiles and clothing exports declined from US$ 38.60 billion in 2014 to US$ 37.12 billion in 2018, while imports increased from US$ 5.85 billion to US$ 7.31 billion during the same period. India slipped to 5th position among garment & textile exporting countries in 2018 from the 2nd position in 2014-17.

The Indian Apparel Industry’s domestic market size is around Rs 2,50,000 crores of which the ‘Organized’ market is Rs 74,250 crores (30%) and ‘Unorganised’ market is Rs 175,750 (70%). After training 43,000 workmen in last 3 years, CMAI has been again requested by Ministry of Textiles to train another 30,000 people in next three years under the SAMARTH scheme, the CMAI stated.

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