Days after Prime Minister Manmohan Singh announced duty-free access to 46 textile items from Bangladesh, the apprehensions are being raised that the move will prove detrimental to the Indian textile industry’s growth plans.
As per a deal signed by India and Bangladesh, a total of 305 products, mostly textile items, can be imported into the country by paying zero per cent duty. The same 305 products can also be imported duty free from Bhutan, Maldives and Nepal.
Ajit Lakra, president of Ludhiana Knitters Association said the duty waiver will work against the industry in India. “Centre has waived off 26% customs duty applicable on these products. All that the Bangladeshi industrialists would be paying is 10.3% counter veiling duty (CVD). The Indian garment industry is already paying 10.3% excise duty,” Lakra said, adding that labour is cheap in the neighbouring country and “we cannot compete with the prices, which will be offered by Bangladesh”.
The Knitwear Club president Vinod Thaper and general secretary Narinder Miglani have already given a memorandum to state congress president Capt Amarinder to be handed over to the PM.
“Once the products (from neighbouring countries) start coming in the Indian market, many Indian units will shift focus from manufacturing to trading. This will lead to cut in the jobs houses and hence manufacturing will reduce. This will lead to job cuts. The Centre should have thought of the adverse impacts before signing the deal,” added Lakra.
Bangladesh had been pressing for the last two years to get duty waiver on 61 products. Of the products, 47 were apparel items including pants, shirts, blouses, skirts, kids wear, cotton nightwear, jeans, swimwear and tracksuits.
Salim Osman, president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), had recently said that Bangladeshi apparel makers will do well in Indian market.