Lobbying needed to export textiles to US

The Indian textile industry needs to beef up lobbying directly with the US authorities if it has to gain tangible success post January 1, 2005 when the quota regime will end.

Thomas G Travis, managing partner, Sandler, Travis & Rosenberg, PA, US, told textile exporters at a seminar on 'Global Sourcing in the post 2005 Environment' organised by AEPC that industry lobbying along can yield results.

He said, "Though the Indian government's lobbying in the US for textile incentives has been effective, it is only one of the many issues it has to look into. It is essential for the textile industry in India to lobby directly."

The US is India's largest market for apparel accounting for a turnover of roughly Rs 203 crore or 41.67 per cent of the total exports for 2003.

With the dismantling of quotas, the trend in the US will be towards operating with fewer suppliers from lesser number of countries and with companies that have a global outlook.

At the same time, traders would not like to put all their eggs in one basket though India increasingly featured in more buyers' lists.

According to him the buyers would strategically choose partners based on existing tariff and preference systems and seek ways to leverage these. Other determining factors would include currency fluctuations, customs and security issues after the September 11 attacks in USA.

The Apparel Export Promotion Council (AEPC) will take a 75-delegate team to visit the United States in June 2004, Premal Udani, senior vice-chairman (Western region) said.

The delegates will visit New York and Dallas. AEPC is also looking to enhance exports to Europe through visits to Barcelona, Paris and London scheduled for August 2004. It has set aside Rs 3 crore for these events.

All countries trading with US will have to be certified under the customs trade partnership against terrorism (CTPAT).

Issues like child labour, wages and working conditions would also be taken into consideration while selecting the suitable partners for trade to ensure brand protection.

Comparing India with China, Travis reiterated that the China has a very bleak chance of entering a free trade agreement (FTA) with the US vis-a-vis India.

Although India's chances were only marginally better, it can become completely quota free, as it already operates with limited quotas.

China on the other hand has existing quota restrictions under the claim that it caused market disruptions. India also has bright chances in Latin America, where there are heavy anti-dumping duties on Chinese goods.