E.U., U.S. to boost Indian textile exports

NEW DELHI:India could be the biggest beneficiary of textile exports to the European Union (E.U.) if they decide to impose emergency restriction on Chinese textile imports.

At a crucial meeting this week, all the members of the E.U. will decide on the matter to impose emergency restriction on Chinese imports. Meanwhile even the U.S. government's Committee for the Implementation of Textile Agreements is shortly expected to take a first step towards imposing "safeguard quotas" on certain textile and apparel products from China.

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Even though quantitative restrictions on the global textile trade were done away from January 1, under China's Accession Agreement to the World Trade Organization, member-countries can impose quantitative restrictions in the form of "safeguard quotas" on Chinese imports till the year 2008 if they can prove that imports from the country are getting "market disruptive" in nature. The restrictive clause applies only to China because of its late entry into the WTO.

According to industry players, even if the E.U. and the U.S. clamp down on Chinese suppliers on a selective basis, Indian exporters could be among the biggest beneficiaries.

The U.S. and the E.U. are India's biggest market for textile exports, and Indian exporters have been smarting under severe competition from Chinese suppliers on most product categories since the opening up of the global textile trade. Exporters admit that during the last few weeks, there has been an increase in enquiries from European and U.S. retailers who are at present sourcing from the country.

If the U.S. or the E.U. impose "safeguard quotas," it would limit increases in import volumes of various categories of Chinese garments to only 7.5 percent every year.