EU textile import quotas may stay

Restrictions on account of Union's expansion

Indian textile exporters may face import quotas in the European Union even after January 1, 2005, the deadline for ending the quota regime. The EU is contemplating the imposition of fresh quotas following the accession of 10 new countries to the Union.

Although India has opposed the move saying it is inconsistent with the Agreement on Textiles and Clothing (ATC), which provides for the elimination of quotas from January next year, Brussels maintains the move is not ATC-incompatible and the additional quotas due to the enlargement of the EU is part of an overall package under consideration.

According to the proposal, quotas in the enlarged EU will be based on the average level of exports during the three-year period from 2000 to 2003.

Besides, the import of textile products up to May 1 by the new member states will be permitted for free circulation within the EU and goods shipped before May 1, 2004 will be quota-free.

The proposal also envisages that goods sent before May 1 to third countries for processing but which re-enter the acceding countries after May 1 will be quota-free.

The matter was discussed at the joint working group on textiles on February 6 but the EU delegation, led by Fernando Perreau de Pinninck, head of unit, textiles negotiations in the directorate general for trade, did not provide a solution, officials said.

They, however, did not elaborate on the future course of action.

On the positive side, officials said, the EU was considering India's request to provide the flexibility of carrying forward unused quotas, despite the end of the quota regime.

The EU was also contemplating granting access to all shipments, which were dispatched in 2004 but would reach EU shores next year, without hindrances. "This is in line with the precedence followed at the time of the integration of products during the earlier phases and also factors in the quota deadline," an official said.

Quota questions

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• The EU is contemplating the imposition of fresh quotas following the accession of 10 new countries to the Union despite the fact that textile quotas are set to be eliminated by January 1, 2005
• The EU maintains the move is not incompatible with the textiles agreement, and the additional quotas due to the enlargement of the EU is part of an overall package under consideration
• However, the EU is considering India's request to provide the flexibility of carrying forward unused quotas, despite the end of the quota regime