Apparel Exporters urge India to enter into Pre trade agreement with UK to neutralize the advantage Bangladesh has in the British market

2020-11-18 14:21:13 Exim News

Apparel exporters have urged India to strike a pre free trade preferential trade deal with United Kingdom in a bid to remove the disadvantage faced by them in the British market. The apparel export promotion council has made this plea in a letter to the Commerce Minister Piyush Goyal

As many as 47 Least Developed Countries (LDCs) including Bangladesh will continue to enjoy preferential trade benefits after the UK’s departure from the EU after the implementation of Brexit in January 2021. This will be a continuation of the disadvantage to Indian apparels in the important and potential market of the UK.

India has been losing out to its competitors in the UK

India has been losing out to its competitors in the UK and hence we request to initiate discussions for an early trade pact for apparels in the run-up to FTA,” Dr Sakthivel wrote in the letter. The AEPC had earlier requested to fast track negotiations to enter into a Free Trade Agreement (FTA) with the UK to boost apparel exports.

The Chairman said that the apparel exports to UK, which is India’s third largest export destination after USA and UAE, have been facing a tariff disadvantage of 9.6 per cent as against countries like Bangladesh due to the EU’s Generalised Scheme of Preferences (GSP), which the UK plans to continue offering to the 47 LDCs.

B’desh exports grew but India’s declined

“It’s not a matter of LDCs. The point is that Bangladesh is equally competitive now and their exports have grown at 11.7 per cent CAGR during 2009-18, when our exports stagnated at 0.5 per cent. Bangladesh exported apparels worth 40.4 billion  US Dollars to UK Market whereas we did 16.5 billion US Dollars in 2019. It’s a labour intensive sector and we need to ask for a special consideration in our bilateral relations with the UK,” Dr Sakthivel said.

India’s readymade garments exports to the UK fell 0.8 per cent to 1,606 million US Dollars in 2019 from 1,619 million US dollars in 2018, cutting the UK's share in India’s exports to 9.7 per cent from 10.3 per cent.

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