Early Implementation Of FTA, CEPA Sought By TEA

TEAThe Tirupur Exporters Association (TEA) has urged the union commerce and industry minister, Nirmala Sitharaman to expedite the Free Trade Agreement (FTA) with the EU, the Comprehensive Economic Partnership Agreement (CEPA) with Canada and the Comprehensive Economic Cooperation Agreement (CECA) with Australia.

Association president, A Sakthivel along with others met Sitharaman in Coimbatore and submitted a representation to the minister to address the export related issues and discussed the strategies for the growth of exports, TEA in a release said.

The TEA said once agreements like the FTA, CEPA and CECA with the EU, Canada and Australia respectively are implemented, exports could double in next three years and provide more employment, particularly to women workforce.

Garment sector, it said, has exported readymade garment (RMG) worth 16.82 billion US Dollar in 2014-15 and out of this, garments valued at 7.23 billion US Dollar were destined to European Union and there is still potential to enhance exports to the EU once the level playing field is provided to the sector.

The association pointed out that India’s main competitor Bangladesh with a least developed country status, is now enjoying the duty free market in the EU and has exported about 15 billion US Dollar in 2014-15 to that market alone, more than double of India garment exports. The TEA said it is confident that India can dent the market share of Bangladesh once FTA is implemented with an additional advantage of being compliances oriented factories at this end. In 2013-14, India’s total readymade garment export to Canada was to the tune of Rs1,493 crore and in last financial year 2014-15 the export was more or less maintained in the same level at Rs1,482 crore with a market share of 3.2 per cent only.

In Canada, competing countries like Bangladesh and Cambodia are entitled to the least developed countries tariff treatment while Pakistan and Vietnam also continue to get benefit under General Preference Tariff (GPT) even after January 1, 2015 and after imposition of normal customs duty of about 20 per cent for Indian garments in Canada, Indian exporters have lost the competitiveness in that country as competing countries continue to enjoy the lower duty.

TEA said with the CEPA, India could compete with these countries effectively and increase its market share. It requested Sitharaman to expedite the CEPA with Canada, which is a promising market for knitwear exporters.