Trade pact with ASEAN India faces tariff discrimination

The global and apparel trade is expected to reach a level of $1600 bn by 2025, by a compounded aggregate growth rate of 6.93 percent in the next decade. The EU and the US are the largest textile and apparel markets, with a share of 34 percent and 14 percent respectively. On the supply side, China is the largest supplier of textile and apparel with a dominant share of 40 percent.

If the Free Trade Agreements (FTAs) signed with several countries in the past have not been beneficial to India, the same is true of the FTA with Asean. The result: large scale imports into India, not envisaged by the government. Under the Asean trade pact, Bangladesh, a least developed country (LDC) gets duty free access. Similarly Vietnam though not an LDC receives the same treatment. Imports also include ready-made garments (RMG) and made-ups from Sri Lanka and Vietnam and even China, though it is not a part of Asean, adversely impacting the domestic industry.