Q-and-A

Most of the ma­chiner­ies or ac­ces­sories, used by In­dian ap­parel in­dus­try are be­ing im­ported from China. Be­ing an ap­parel ex­porter, tech­nol­ogy provider or ac­ces­sory/fab­ric im­porter, have you no­ticed any im­pact of the on­go­ing ten­sion be­tween China and In­dia?

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Dr. San­deep Gupta, Richa In­dus­tries Lim­ited, Farid­abad

It is true that most of the ma­chiner­ies or ac­ces­sories, used by the In­dian ap­parel in­dus­try are be­ing im­ported from China. How­ever, we at Richa, are un­af­fected by this sit­u­a­tion and we have rather seen benefits in our busi­ness. One such re­cent ex­am­ple is the in­crease in sale of polyester fab­ric. Most of the fab­ric buy­ers have now moved to do­mes­tic players for fab­ric pur­chase rather than de­pend­ing on the China mar­ket, all thanks to the “Make in In­dia” move­ment driven by our Gov­ern­ment. We are now wit­ness­ing a rise in or­ders from do­mes­tic buy­ers as an out­come of this.

In our pro­cess­ing unit, the prices of dyes and chem­i­cals that we are us­ing have hiked as the raw ma­te­rial for the im­por­tant dyes and chem­i­cals is pro­cured from China. The halt in their sup­ply be­cause of the ten­sion be­tween In­dia and China has made all the ven­dors in­crease their prices, which has im­pacted our cost­ing. How­ever as true In­di­ans, we have com­plete faith on our gov­ern­ment and their ac­tions. These ef­fects are just tem­po­rary hur­dles in the path for a bet­ter and de­vel­oped In­dia. Hence, we are hope­ful about a bet­ter sit­u­a­tion in fu­ture. Even in worst cir­cum­stances, if the sit­u­a­tion de­te­ri­o­rates fur­ther, there will be neg­li­gi­ble im­pact on the tex­tile in­dus­try. In­dia is adept at han­dling all types of sit­u­a­tions in any given cir­cum­stances.

Vi­jay Agar­wal, Chair­man, Creative Group, Mumbai

I think the re­la­tion­ship of

In­dia and China is sim­i­lar to that be­tween a hus­band and a wife. In spite of sev­eral stand-offs, both the par­ties strug­gle hard to main­tain their as­so­ci­a­tion. How­ever, the good thing is that this sev­er­ing of ties be­tween the two coun­tries would not have a ma­jor im­pact on the In­dian ap­parel ex­port. The first rea­son for stat­ing this is that I don’t think our im­port of Chi­nese fab­ric and trims could be more than 2-3 per cent of our ex­ports. As far as ma­chine is con­cerned, the good brands will find other places to man­u­fac­ture the same; and since China is be­com­ing ex­pen­sive for such brands, they will be look­ing at Viet­nam, Cam­bo­dia and other places as sub­sti­tutes.

And one should not for­get the trade deficit be­tween In­dia and China which is favourable for China and they would be big­ger losers than In­dia in case of a fall-out with In­dia. Over­all, I don’t think there would be a se­ri­ous prob­lem in ex­ports if sit­u­a­tion be­tween In­dia and China does not im­prove.

San­jay K Jain, MD, TT Ltd., Delhi; Chair­man, NITRA/Vice Chair­man, CITI

There is a def­i­nite un­easy po­si­tion be­tween the two giants; how­ever, I don’t see this pre­cip­i­tat­ing to an eco­nomic tus­sle in any ma­jor way which would in­flu­ence the trade flow be­tween the two coun­tries.

Yes, we can see some an­tidump­ing and safe­guard mea­sures com­ing in a bit faster, but that’s the max­i­mum im­pact that I see hap­pen­ing at this stage.

San­jiv Jain, Pres­i­dent & CEO, TQM Global Buy­ing, Noida

The ten­sion be­tween China and In­dia at the bor­ders is still not vis­i­ble on the im­ports, and I per­son­ally don’t think, this will be vis­i­ble very soon. China has grown tremen­dously in in­fra­struc­ture and to sus­tain this growth, they can­not af­ford to strain re­la­tions with any big coun­try who is a ma­jor buyer for them in nu­mer­ous prod­ucts. They would rather try to solve the prob­lems across the ta­ble. These are my views of this is­sue at present.

How­ever, if the ten­sion be­tween In­dia and China es­ca­lates, it can have spi­ralling im­pact on the trade re­la­tions be­tween the two nations. China has al­ways looked at In­dia as a lu­cra­tive mar­ket. And if these re­la­tions worsen, the im­ports are go­ing to cer­tainly fall and af­fect both the coun­tries equally. In­dia would lose vol­ume of ex­ports at an eco­nom­i­cal price, due to lack of ma­te­ri­als or ma­chin­ery. Po­lit­i­cally China has more to lose than In­dia. In­dia is not too de­pen­dent on China yet, due to its mas­sive do­mes­tic in­dus­try, and still can find more op­tions for im­port­ing these prod­ucts and ma­chines. But all these are mere an­tic­i­pa­tions at the mo­ment. We just need to wait and watch!

Jay Ku­mar, CEO, Fed­mac, Tirupur

Bor­der stand-off be­tween In­dia and China is a fre­quent is­sue but till now, it has no cru­cial ef­fect on the com­merce be­tween the two nations. Although this time around, the ten­sion is more pro­nounced, it is nowhere close to caus­ing dis­rup­tions in busi­ness. Both coun­tries can hardly af­ford car­ry­ing

decades old bor­der is­sues to the busi­ness ta­ble. US, Ja­pan, Korea too have sim­i­lar fric­tions with China but busi­ness amongst these coun­tries con­tin­ues as usual.

Prabhu Dhamod­ha­ran, Con­venor, In­dian Tex­preneurs Fed­er­a­tion (ITF), Coim­bat­ore

China has huge trade trans­ac­tions with In­dia and may not choose to be­come more ag­gres­sive. In­dia and China are the two big­gest and fast-grow­ing mar­kets, and they should fo­cus on bet­ter trade re­la­tion­ships, in­stead of fight­ing. Both coun­tries may look at op­por­tu­ni­ties in trade with Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship

(RCEP) ne­go­ti­a­tions.

We are con­fi­dent about In­dian Gov­ern­ment’s ma­tured strat­egy to deal with this sub­ject and we may ex­pect an am­i­ca­ble di­a­logue based so­lu­tion to­wards this is­sue. We don't view this as a ma­jor threat to our tex­tile trade.

M.G. Goswami, Re­tail Head, F-Stu­dio Fash­ion, Su­rat

Trade be­tween China and In­dia is about US $ 70 bil­lion and trade deficit of about US $ 44 bil­lion is in favour of China. Both coun­tries have tar­geted to in­crease the trade to US $ 100 bil­lion by 2020. Most im­por­tantly, we are liv­ing in the era of glob­al­iza­tion wherein ev­ery coun­try’s econ­omy is in­ter­de­pen­dent on each other. We can­not, there­fore, risk de­te­ri­o­rat­ing the trade re­la­tions with the sec­ond largest econ­omy of the world. Rather we should use this plat­form to re­solve the bor­der dis­putes with China. So, if both the coun­tries want good progress, it is nec­es­sary for them to give each other a help­ing hand.

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