Domestic garment makers hope for better days with curb on imports

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| Photo Credit: Reuters

With India limiting import of readymade clothes from Bangladesh by land ports, home garment producers hope to see revival in orders. In a notification issued on May 17, the Director General of Foreign Trade (DGFT) stated readymade clothes will be imported from Bangladesh solely by Nhava Sheva and Kolkata ports.

“Dealers in northern States were able to get hold of cheap imported garments that cost almost 20% lesser than Tiruppur products. The situation worsened in the last 2-3 years,” stated S. Balachandar, vice-president of the South India Hosiery Manufacturers Association.

“Now, the garments can be brought in only through sea ports. This will reduce the illegal entry of ready-made garments. The undergarments made in Tiruppur will be competitive cost-wise with the goods coming by sea. In a couple of months, we hope to see orders increasing for MSMEs in Tiruppur,” he stated. Imports of low-priced clothes in big portions will definitely cut back now, he stated.

The Confederation of Indian Textile Industry (CITI), quoting commerce information, stated India imported readymade clothes price $634 million in 2024, which noticed 19% CAGR progress within the final 10 years. Total textile and attire exports from India to Bangladesh in 2024 have been $3.2 billion and exports from Bangladesh to India have been $1.07 billion. Though India has a commerce surplus with Bangladesh in textiles and attire, its exports grew 4.97% (CAGR) between 2015 and 2024, whereas Bangladesh’s exports to India grew 12.87%.

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Garments price ₹5,000 crore to ₹6,000 crore are imported by India from Bangladesh yearly, together with these by the unorganised sector. “The DGFT decision will reduce the backdoor entry of Chinese fabrics that were getting converted in Bangladesh and entering India without duty,” stated Sanjay Jain, chairman of the National Committee of Experts for Textiles, Indian Chamber of Commerce.

Rahul Mehta, chief mentor of Cloth Manufacturers Association of India, stated Bangladesh imports value 12-15% much less in contrast with Indian merchandise. These imports will now shift to sea ports, escalating the associated fee by nearly 10% and growing the supply time. This is prone to make Indian patrons look to home suppliers, he stated.

However, business representatives level out {that a} majority of the imports is by retail chains. It stays to be seen how patrons will react to the restriction.

According to Mithileshwar Thakur, Secretary General of AEPC, restrictions on garment imports from Bangladesh will disrupt the availability chain within the quick time period. However, since many of the imports are by giant retailers, the long-term influence will rely on how efficient the ocean commerce is. For low or medium-volume imports, land ports will probably be most well-liked.

Rakesh Mehra, chairman of the Confederation, stated the DGFT determination will create new alternatives for home garment producers. It can even allow Indian cotton yarn exporters to redirect their provide to the home market. Bangladesh imposed a restriction final month on export of cotton yarn from India, which historically accounts for practically 45% of India’s complete cotton yarn exports, he stated.

Industry sources stated the retail chains in India import artifical fibre (MMF) clothes primarily from Bangladesh, China, and Vietnam. Readymade clothes from Bangladesh proceed to get pleasure from zero obligation entry in India, giving the imports a price benefit. The authorities ought to ban import of clothes from China and evaluation the obligation free entry for Bangladesh clothes in order that the home textile chain revives, they stated.