• Chi­nese tex­tiles into In­dia Back En­try Should be Avoided: CITI

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The In­dian tex­tiles in­dus­try wants tweak­ing of the South Asian Free Trade Area (SAFTA) rules of ori­gin to make use of yarn and fab­rics of In­dian ori­gin manda­tory for ex­port­ing ap­parel to In­dia, ac­cord­ing to Con­fed­er­a­tion of In­dian Tex­tile In­dus­try (CITI) chair­man San­jay K Jain. Bangladesh ex­port­ing ap­parel to In­dia duty free is ben­e­fit­ing China’s tex­tile ex­ports, he said.

In­dia al­lowed duty-free im­port of ready­made gar­ments from Bangladesh un­der SAFTA in 2006, lim­it­ing the num­ber to eight mil­lion pieces. How­ever, this re­stric­tion was lifted in 2010. Bangladesh im­ports Chi­nese fab­rics, man­u­fac­tures gar­ments and ex­ports those to In­dia without the need for pay­ing any im­port du­ties. As im­port of ‘made in China’ fab­rics is meant for ex­port, Bangladesh im­poses no im­port du­ties on those, and this ends up fa­cil­i­tat­ing back­door en­try of Chi­nese tex­tiles into In­dia. In­dian gar­ment man­u­fac­tur­ers have to pay a 20% im­port duty if they use the same Chi­nese fab­ric, he said. In­dia’s gar­ment im­ports from Bangladesh in­creased from $106.72 mil­lion dur­ing April-de­cem­ber pe­riod 2016 to $124.14 mil­lion in the cor­re­spond­ing pe­riod of 2017, ac­cord­ing to CITI sta­tis­tics. As In­dia has ex­tended this du­tyfree quota-free fa­cil­ity to 49 least-de­vel­oped coun­tries on a non-re­cip­ro­cal ba­sis and without sourc­ing re­stric­tions, it is ex­pected that In­dia may face more Bangladesh-type sit­u­a­tions in fu­ture.

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