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| Issue date:15/10/2009 |
| ATA Journal for Asia on Textile & Apparel - Oct 2009 Issue |
| Source:Journal for Asia on Textile & Apparel |
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China
Textile and apparel exports drop less than national average
The Chinese Customs announced that the textile and apparel exports dropped, but less than national average. China’s total textile and apparel exports reached US$67.46 billion in the first eight months of 2009, down 10.4% than a year ago. Exports of textile yarns and textile products were US$37.43 billion, sliding 14.9% from last year.
The weaker export performance in China was mainly due to a diminished consumer demand for textile and apparel goods in North America and Europe, following the global financial crisis that broke out last September.
The Ministry of Industry and Information Technology of China announced that production of yarns, fabrics, apparel and chemical fibers by sizable enterprises (with an annual operating revenue of at least RMB5 million) increased 10%, 1.1%, 4.8% and 11.8% respectively in the first seven months of 2009, compared to the same period of last year.
Projects investing fixed asset more than RMB5 million reached RMB162.5 billion in the January-July period this year, up 5.9% from last year, but the growth rate was 7.2 percentage points lower than that of 2008. The number of new projects climbed 20.1% year-on-year to 4,557.
China’s consumer price index (CPI) was 97.6 (-2.4% y-o-y) , while the producer price index (PPI) was 99.4 (-0.6% y-o-y) in July.
ASEAN+6 countries approaching to intra-regional FTA
Tighter economic ties were encouraged at the 41st ASEAN Economic Ministers Meeting among ASEAN members and six Asian nations held in Bangkok, Thailand, this August. Free trade agreements were signed between ASEAN with China and India respectively.
The negotiation process of China-ASEAN Free Trade Area (FTA) was completed with the two sides agreeing on investment projects in addition to trade in goods and services. The FTA will take effect by January 1, 2010. Under the agreement, about 93% of goods (or some 7,000 products including textiles and apparel) traded between China and ASEAN are tariff-free.
In addition, the ASEAN economic ministers and Indian Minister of Commerce and Industry Anand Sharma signed a free trade agreement (FTA) for trade in goods after a six-year negotiation. The ASEAN and Korea signed a letter of understanding on the product specific rules of origin to facilitate trade between two sides. Talks were also held between the ASEAN and Australia and New Zealand respectively.
Taiwan sees production drop
Total textile and apparel production of Taiwan was projected to reach about NT$400 billion in 2009, shrinking 8% from last year, the Taiwan Textile Research Institute (TTRI) said this August.
Data of the Department of Statistics of Taiwan’s Ministry of Economic Affairs showed that the total textile and apparel production value reached NT$167.8 billion in the first half (H1) of 2009, down 29% from the same period of last year.
The manmade fiber segment, taking up 24% of the total textile and apparel industry, took a hard blow in the current economic recession. Production value of this segment plunged 38% from the last year to NT$43.37 billion in 2009 H1.
Textiles, the biggest segment of Taiwan’s textile and apparel industry, were also hard hit, recording a production decrease of 26% from last year to NT$112.18 billion in 2009 H1.
Apparel and accessories, accounting for 7% of the total textile and apparel industry, fell 21% year-on-year. The decrease rate of this segment narrowed in the second quarter compared to that of the Q1.
The TTRI estimated that the external trade environment would look better in the second half this year.
Indonesia
Exports to EU slow down
As European markets declined in recent months, Asian textile and apparel makers were adversely affected, including those in Indonesia.
Vice chairman of Indonesian Textile Association, Ade Sudradjat, said that the market share of apparel originating from Indonesia to the European Union (EU) fell due to the failure of Indonesia to attract orders from apparel investors of South Korea, Taiwan and China.
Indonesia’s share in the international textile and apparel trade was forecast to descend. Weaknesses were observed in the areas of inadequate access to buyers, as well as low skills of design to meet needs from Germany, Italy and UK clients, who turned to Vietnam, Bangladesh and elsewhere.
Against the background, he urged the Indonesian government to support the textile and apparel industry by building adequate infrastructure, maintaining stable prices of raw materials, training more productive workers and so forth. In addition, the industry needed to diversify its export markets, reducing the dependence on Europe.
Signs of recovery seen in Q2
Exports of textile and apparel of Indonesia in the second quarter started to show good signs. The slowdown remained but the drop in the second quarter narrowed, according to the Indonesian Textile Association.
Total textile and apparel exports of Indonesia dropped 14% in the first quarter of 2009, and further 8% in the second quarter, making the averaged decrease in the first half 11% compared to the same period of last year. “In terms of month-on-month comparison, export recovery in the textile and apparel trade showed good signs in the second quarter of the year,” said vice chairman of Indonesian Textile Association, Ade Sudradjat.
The export slowdown was partly offset by the increase of domestic sales. Domestic textile and apparel sales in Indonesia reached US$4.02 billion in the first half of 2009, or up 15% from US$3.5 billion in the same period last year.
Mr Ade predicted that both textile and apparel exports and domestic sales were more likely to increase in the later period of the year.
Festival may boost local demand
Apparel consumption in Indonesia was expected to increase 15-20% during the fasting month and Lebaran Day this September, making some producers anticipating a two-fold jump of their production, although they would also compete with imports from other Asian countries such as China, India and Thailand, the Indonesian Textile Association said.
The association’s Secretary Executive, Ernovian G. Ismy, said that illegal imports of apparel were serious. Thus, a new regulation starting this January restricted textile and apparel imports through five seaports in Tanjung Priok (Jakarta), Tanjung Emas (Semarang), Tanjung Perak (Surabaya), Belawan (Medan), and Soekarno Hatta (Makasar).
Based on data from the Indonesian Textile Association, the total domestic apparel market reached 1.24 million tons valued at US$7.18 billion in 2008. Of which, 16% was detected illegal imports at a value of US$1.149 billion. The domestic market share was forecast to increase about 10% this year, or to 1.362 million tons at US$7.56 billion from 1.238 million tons last year.
Asking to delay free trade with China
Indonesian industry association commented that the country is not yet ready for ASEAN-China Free Trade Agreenment (FTA) scheduled to be effective starting January 2010.
“ASEAN-China FTA will implement zero tariff for textile and apparel, which is currently ranging from 5% to 15%. For Indonesia, this will result in the flooding of textile and apparel originating from China in the domestic market. The number of import will double from US$900 million to US$1.8 billion next year,” said Vice Chairman of Indonesian Textile Association, Ade Sudradjat.
“Industry is not involved in the discussion about the advantages and disadvantages of the agreement,” said Benny Soetrisno, Chairman of Indonesian Textile Association, adding that imports of textile and apparel from China to Indonesia are currently worth US$900 million annually, which represents 13% of the total market of Indonesia at US$7 billion.
Other manufacturing players also voiced out concerns. Vice Chairman of Indonesian Chamber of Commerce and Industry (Kadin), Rachmat Gobel, considered that the manufacturing sectors of Indonesia including textile and apparel are lag behind China and some other ASEAN countries. Hence, the country should slow down the process of trade liberalization as its internal industries need time to prepare themselves.
Vietnam
Textile and garment exports to exceed US$9 billion this year
Vietnamese textile and apparel industry is forecast to reach an export turnover of US$9.2 billion in fiscal year 2009, slightly lower than the initial US$9.5 billion target.
Chairman of Vietnam Textile and Apparel Association (VITAS), Le Quoc An made the above prediction this August during a meeting of Ministry of Industry and Trade with textile and apparel industry on plans for industry development in 2009 and 2010.
The target was adjusted mainly due to impacts of the global economic turmoil since late 2008, although the country witnessed recovery in these months, especially in exports, he said.
Textile and apparel exports turnover of the country fetched US$ 5.91 billion until this August, down 1.4% year on year and accounting for 56.2% of the 2009 target. The export of August alone was US$870 million, representing a 5.8% drop from the same period of last year.
At the meeting, representatives from the VITAS set its export turnover target of US$10.5 billion in 2010 and US$17 billion in 2015.
Expanding exports to Chile
Vietnam Textile and Apparel Association (VITAS) in August led a delegation of leading apparel enterprises to Chile in a bid to look for partners, as well as to pave better ways in exporting textile and apparel products to this market.
Among 13 enterprises of the delegation, three signed contracted with the local partners, namely Protrade Garment company for a T-shirt contract, Hanoximex for a contract of Polo shirt and Tien Tien Garment with a veston suit and kidswear contract.
The delegation also met Chile’s leading apparel importer and distributor Cencosud, which planned to import apparel products from Vietnam.
Enterprises in Chile imported US$14 million of textile and apparel products from Vietnam in 2008, accounting for 0.7% of its local market.
Textile material imports fall in H1
Statistics of the Vietnamese General Department of Customs showed that imports of some materials for textile and apparel manufacturing declined sharply in June as well as in the first half this year because of the decreased production of local enterprises.
In the first half this year, cotton imports turnover stood at 1.09 million tones for US$137.2 million, down 26% and 39% respectively over the same period of 2008. Similarly, imports of yarns for local production experienced an 11.5% decline to US$351.8 million.
Accounting for 61.3% of imported cotton to Vietnam with 66,475 tons at US$84.24 million in the first half, the US was the biggest cotton supplier to the country, followed by Brazil with 4,868 tons at US$6.5 million. Fabric imports also dropped 11% in the first six months of 2009 to US$1.98 billion.
In the meantime, there was a strong growth in volume of imported yarns totaling 2.367 million tons, up 15% from last year, according to the Vietnamese Customs.
World organizations help improve labour relations
Better Work Vietnam (a partnership between International Labour Organization and International Finance Company) was officially launched this July, providing services to textile and apparel enterprises in Ho Chi Minh city and surrounding provinces.
With objectives to help local enterprises in Vietnam improve relations with labour and to set up cooperation with international partners, Better Work Vietnam offers training to local senior officers, consulting services in labor issues as well as carrying assessment on standards of international and national labour laws.
Advised to target fashionable clothing
Vietnamese apparel makers were advised not to target low-end segment when exporting to Japan, but to improve their designing skills to produce fashionable apparel.
In a seminar held this July by the Vietnam National Textile and Garment Group (Vinatex) and Vietnamese Commercial Affair, a Japanese designer, Horikoshi, participated the seminar and provided information of market trends for fashionable apparel products in Japan. He added that branding is also important along with the offerings of high-quality products with varied styles. Vietnamese apparel exporters were not advised to market cheap products to Japan as that market share is mainly dominated by made-in-China products.
With the Vietnam-Japan Economic Partnership Agreement (VJEPA) effective since July 2009, more Vietnamese apparel exporters showed interest in exploring the Japan market. Under the agreement, Vietnamese enterprises using fabrics sourced from Japan enjoy a free market access to Japan instead of 5-10% tariff as stated previously.
Materials trading center to be reopened
The Vietnam National Textile and Garment Group (Vinatex) bought 20% shares of Lien Anh Trading Center for materials of textile, garment and footwear in order to re-open it.
Being the first of its kind in Vietnam, the US$12 million-center closed its door in June after one month into operation, as there were insufficient material suppliers to hire stalls in the center and attract buyers. Situated in the southern Binh Duong Province, the center is expected to re-open in mid-2010.
Under the new plan, Vinatex will use this center to showcase textile products made by its subsidy companies like Hanosimex, Phong Phu Corporation, Viettien, Viet Thang Textile and Phu Bai Spinning. The group also hopes to bring more materials suppliers to attract more buyers. Foreign suppliers are welcomed to exhibit their textile and apparel goods in the center, Vinatex adds.
Vinatex to invest US$198 million in cotton cultivation
Vietnam National Textile and Garment Group (Vinatex) announced to invest VND3,500 billion, equivalent to US$198 million, in cotton plantation in the 2009-2020 period to revive the cotton planting industry.
Vinatex will focus on three provinces in the Central Highland, namely Dac Nong, Dac Lac and Gia Lai.
Vietnamese Prime Minister, Nguyen Tan Dung, earlier announced a government decision on distributing free cotton seed to cotton farmers in five provinces across the country in an attempt to revitalize the domestic cotton plantation industry.
Separately, Vinatex revealed in September its plan to carry out an initial public offering early next year and would complete the process of corporate value evaluation in the fourth quarter of 2009, said its Group Chairman, Le Quoc An.
India
EU eco-compliance on chemicals arouse concerns
Indian textile and apparel manufacturers could face hurdles exporting to the European Union (EU) in future when a law on chemicals and their safe use becomes effective in 2011, experts said.
By December 1, 2011, producers or exporters will have to notify the European Chemicals Agency (ECHA) if their goods contain hazardous properties of a substance (including dyes and pigments) listed in the candidate list of a new law called Registration, Evaluation, Authorisation and Restriction of Chemical Substances (REACH), which came into force in June 2007 and is being rolled out in phases.
Enterprises manufacturing or importing more than one tonne of a chemical substance per year are required to register the chemical in a central database. The general aim of REACH is to replace these potentially hazardous substances by safer alternatives whenever possible.
The European Chemicals Agency (ECHA) is authorised to define restrictions for the use of specific chemicals. Experts in India mentioned it might have significant implication on exports of apparel, textiles and textile polymers to the EU.
Indian players are advised to pay more attention to the eco-compliance and the penalty could be as high as 75,000 euros per consignment or having the entire shipment burnt.
India exported nearly 47% of its apparel production to the EU worth US$5 billion in 2008-09.
Apparel sector picking up
Major vendors in India believed that the worst was behind them and apparel exports might be turning around, though perhaps under pricing pressure. They did not expect a big shift to the domestic sector due to slack demand and low margins.
Apparel exporters in Bangalore commented that indications showed that the order situation would improve by next March. As for the potential of the domestic market, consumption was believed to be down 20-30% in higher price segments. Demand in mass segments was steady, but not many players were entering those areas in view of low profit margins.
Rajendra Hinduja, Executive Director (Finance) of Gokaldas Exports Ltd, said: “The scenario is certainly better than what it was six months ago, thanks to a pick-up in the European and US demand. It is likely to improve in the next six months, as orders for Christmas and the next summer start coming in.”
“The April-June period is always lean. The situation improved after this June. Volume has increased but value is down. There has been no shift in making garments for the domestic market, because there is demand only in the urban areas,” said Jayaram K.R., Vice-President, Garment and Textiles Workers Union.
The index of industrial production for textile products turned positive after April 2009, registering a year-on-year growth of 2.5%. This increased to 9.8% in May and later 11.7% in June this year.
In 2008-09, apparel exports out of India were 14% short of the US$11.62 billion target and leveled at US$10.17 billion, or 4% higher than US$9.68 billion in the previous year, according to the Apparel Export Promotion Council (AEPC) of India.
Pakistan
New five-year textile policy announced
The government of Pakistan unveiled the first-ever five-year National Textile Policy, setting an export target of US$25 billion.
Federal Minister for Textile Industry, Rana Farooq Saeed Khan, announcing the incentives-laden textile policy for 2009-2014, said that the government would take immediate measures on a priority basis to help fix problems faced by the textile industry, including improvement on gas and electricity load management, export refinance at lower rates and relief on existing long-term loans.
He added that restructuring and reorganisation of the textile sector was also on the cards. The key initiatives taken under the policy include the creation of a textile investment support fund, a technology upgradation fund (TUF), development on infrastructure and skill of workers, zero rating of exports, as well as tax free import of machinery and rationalisation of tariff structure.
The policy announced also envisages the removal of regulatory bottlenecks, such as export market access, marketing support, marketing insurance scheme and improving information and communication technology. Initiatives concerning a number of textile sub-sectors were announced as well. The policy also includes support of employment among women, the disabled and the handicapped.
The new policy was prepared to address such industry challenges as lack of updated machinery, shortage of electricity, gas and water, as well as skilled manpower.
Under the TUF programme, the government will pay 50% of the markup on the investment in new plants and machinery to encourage the adoption of new technology in the country.
Moreover, industrial estates with necessary facilities will be built in line with the development of garment and apparel cities in Pakistan. Research centers, product development centers and laboratories will be erected in the textile manufacturing regions.
On the front of human resources, the minister said that training will be provided to about 500,00 people in the next five years with the help of the textile and apparel industry to overcome the shortage of skilled manpower. A funding of Rs1 billion for the skill development is allocated by the government.
Export target likely unmet this year
The textile export target of US$10.5 billion set by the Pakistani government might be missed this fiscal year, and a number of remedies were announced by the Ministry of Textile.
These remedies include a 3% rebate given to the apparel sector, 2% to the home textile sector and 1% to the fabric making sector. However, industry observers said that it may not help significantly in boosting exports to meet the target.
Chairman of the standing committee on textiles at the Federation of Pakistan Chamber of Commerce and Industry (FPCCI), Dr Shahzad Arhsad said that textile manufacturers and exporters had tabled a demand of 6% rebate for the sector of apparel, 5% for home textile and 3% for fabric making, but the demand was not fully accepted.
A relaxation of 2.5% is also given in the interest rate under the export financing scheme. The government gave one-year relaxation to pay back the long-term loan, whereas the interest rate, up to 5%, is exempted.
However, Dr Shazad urged the government to work to obtain a duty-free entry of textile goods from Pakistan to the US and the European Union markets, in addition to achieving a Generalised System of Preferences (GSP) Plus status.
Interruptions in electricity and gas supply, as well as prices of energy and water are areas of concerns as well, he added.
Bangladesh
Garment sector faces unrest
Leaders of the textile Engineers and Technologists were concerned about recent labour unrest in the readymade garments sector of Bangladesh.
Following the global economic slowdown, orders declined among apparel making factories in Bangladesh. Low and delayed wage payments, in addition to some layoffs, were believed to have caused a number of labour unrest incidents in the country in July and August this year, according to local media reports.
Factory owners, on the other hand, blamed “jhut” (garment waste) traders and vested quarters for the unrest.
The Institute of Textile Engineers and Technologists (ITET) Bangladesh demanded the government to form industry police to protect law and order in readymade garment making factories.
Turkish firm interested in local factory
Turkey-Bangladesh Chamber of Commerce and Industry (TBCCI) showed interest in reopening the Rajshahi Textile Mills, which remained idle for last few years. Interest was shown when a TBCCI delegation called on Rajshahi City Corporation (RCC) Mayor, AHM Khairuzzaman Liton, at the latter’s office this July.
The delegation members during the discussion expressed their keen interest in fostering development of trade and business relations between Bangladesh and Turkey. Necessary facilities would be important to facilitate entrepreneurs to invest in the region, they added. There is a large demand of garment and different other fancy products especially handicrafts and silk items in the Turkish markets.
Better working condition called for
Bangladeshi knitwear manufacturers were advised to further improve labour conditions and ensure safety in factories in order to develop itself as a top apparel exporter in the world.
During a meeting with knitwear factory owners from the country, President of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Fazlul Hoque, said: “Wage hike of workers alone will not improve compliance situation in the country. There are other areas to be addressed. Mutual trust between workers and owners has to be strengthened to maintain congenial working environment in the factory, which in turn will boost growth.”
Mr Hoque held the opinion that Bangladesh would be able to surpass Turkey, the second largest knitwear exporter after China, within the next one year. However, it will take time to outdo China.
Chinese investment in Comilla
A Chinese company, M/s Bangladesh Textile and Fibre Industry Limited, will set up a fibre and nonwoven fabric manufacturing industry in Comilla Export Processing Zone (EPZ), 97 km from Dhaka.
An agreement was signed between the Bangladesh Export Processing Zones Authority (BEPZA) and the company this August. The Chinese company planned to make an investment of US$25.52 million in setting up its manufacturing unit and produce different types of fibres and nonwoven fabrics.
The operation will create employment opportunity of 895 workers in Bangladesh, including 21 foreign nationals, the company revealed.
For daily news of the textile industry, please visit AdsaleATA.com
Country Focus: India
Seeking to diversify markets to Japan and ASEAN
by Staff Reporters and Ajay Sinha
The Indian textile and apparel industry is currently one of the largest and most important industries in the Indian economy in terms of output, foreign exchange earnings and employment. The industry contributes 4% to the country’s GDP, 14% to the country’s industrial production and around 12% to the country’s foreign exchange earnings, according to a report commissioned by the Confederation of Indian Textile Industry (CITI) and the Cotton Textiles Export Promotion Council (Texprocil) issued this June.
Due to the current economic slowdown of major advanced regions, the Indian textile and apparel industry may not reach the 2009 targets previously set by the Ministry of Textiles, such as a 16% annual growth of the industry to reach US$115 billion by the end of 11th Five Year Plan (i.e. 2012).
India’s textile and apparel market reached estimated Rs 2.55 trillion in 2007-08, with exports accounting for 35% of the total market value. The industry depended heavily on exports to the 27 European Union members (EU27), which took up 33% of the total exports by value in 2007-08, the report mentioned.
Among the EU members, the UK was the largest buyer for Indian textile and apparel, or 7.5% of India’s total textile and apparel exports by value in 2007-08.
The US was the second largest export market for Indian textile and apparel industry, purchasing 21% of India’s total textile and apparel exports by value in 2007-08. The US registered negative economic growth in the second half of last year and retail sales of apparel in US shrank significantly as a consequence.
Percentage change in Indian textile and apparel export value in 2008 |
As the EU, US and other major overseas buyers were substantially affected by the global financial crisis, overseas demand for exports plunged in the last quarter of 2008, followed by a textile and apparel production decline in India.
The Index of Industrial Production (IIP) for cotton textiles declined 3.7% (year-on-year) in December 2008, 6.2% (y-o-y) in January 2009 and 12.1% (y-o-y) in February 2009. Apparel production also dropped 2.3% this February compared to the same period of last year.
Bottom line was hurt
Profit margins of Indian textile and apparel firms declined significantly from the fourth quarter (Q4) of 2007 to 2008 Q4, based on an analysis of a sample of 81 such firms in the CITI/Texprocil June 2009 report.
It reflected the stressful situation faced by the Indian players, partly because a number of them had engaged in debt-funded capacity expansion under the Textile Upgradation Fund Scheme (TUFS) over the last few years. The recent drop in production resulted in under utilisation of capacities leading to inadequate absorption of fixed costs and weak debt coverage indicators, the report observed.
Under the TUFS, the Indian authorities provided interest subvention and/or capital subsidy for specified processing machinery. The scheme was introduced to encourage technological upgrade to enhance the competitiveness of Indian textiles at home and markets abroad.
With such issues as pressure on working capital and debt interest that are unfavorable to financial viability, the Indian textile industry was under pressure at least until the first quarter this year.
Net profit margin of 81 sampled Indian textile and apparel companies in 2008 (source: CITI/Texprocil June 2009 report) |
Expects textile industry to revive in months
The situation gradually improved in the second and third quarter as some fabric and garment production units reported a pick-up in international demand. It was expected to translate into a higher demand for spun yarns. While spinners reported a slack demand for cotton and polyester cotton yarns, polyester viscose yarn manufacturers continued to receive export orders.
Another recent study by the Confederation of Indian Industry (CII) estimated an 8% decline in cotton production in the country to about 29 million bales during the current year. There can be a 5% decline in domestic cotton consumption in 2009. However, the consumption can pick up slightly in 2010.
The country’s cotton acreage might increase from 9.37 Mha (million hectares) in the current year to 9.5 Mha in 2010. Domestic raw cotton prices increased significantly during 2007-2008 due to strong export demand. In spite of the Central government raising the minimum support price of different varieties of cottonseed by 39-45%, cotton prices have declined sharply during 2009 because of weaker international prices and less favourable demand prospects.
To further revitalize the export-oriented textile industry of India that ships overseas about 60%of its products, the CII study recommended government incentives for the industry in order to make it more competitive internationally. Pointing out that Indian cotton was cheaper in the international market than in the domestic market, the study suggested the government taking steps to stabilise raw cotton prices on par with neighbouring countries like China, Bangladesh and Pakistan.
Besides, improvement on cost competitiveness in the areas of technology and economies of scale for the Indian fabric and garment sectors to improve profitability was also beneficial to the industry.
Selling to Japan and ASEAN
Lastly, industry observers believe that Indian apparel exporters should explore more markets, reducing trade dependence on EU27 and the US.
Japan as a large apparel exporter, as well as Russia, is a good prospect. Japan accounts for 1% of India’s total textile and apparel export value in 2007-08. China being the major exporter to Japan in this field, shares over 70% of Japan’s total textile and apparel imports, in accordance to the CITI/Texprocil June 2009 report.
To facilitate the trade, India’s Union Minister for Textiles Dayanidhi Maran led a delegation to Japan this July, with representatives of Apparel Export Promotion Council (AEPC), the Texprocil, the Synthetic and Rayon Textiles Promotion Council (SRTEPC), Knitwear Technology Mission, and leading textiles manufacturers and exporters from Tirupur and Coimbatore textiles clusters.
The Indian minister invited Japanese textiles industry, during the delegation, to collaborate with their Indian counterparts in manufacturing fabrics and setting up of greenfield units of textiles machinery in India. In the addition to the cost advantage in terms of cheap labour, he highlighted the multiple advantages India has in the form of highly skilled workforce, high capital-employment ratio and a diverse raw material base.
Effective from January 2010, the Free Trade Agreement (FTA) between India and the ASEAN paves the way for the creation of one of the world’s largest free trade areas, of almost 1.8 billion people with a combined GDP of US$2.75 trillion, the ASEAN Secretariat stated.
Under the agreement, tariffs on more than 80% of total imported goods will be reduced to zero by 2013, and another small proportion of goods will be given zero tariff by 2016, involving totally over 4,000 product items.
India and ASEAN targeted to achieve bilateral trade of US$50 billion by 2010 from US$40 billion in 2007-08, the Indian Department of Commerce said. It is expected to bring economic benefits to the Indian industries including textile and apparel. |
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We reserve the right to take legal action against any party who reprint any part of this article without acknowledgement. For enquiries, please contact the Editorial Department. |
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