3 months ago
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The U.S.-Bangladesh Agreement connected Reciprocal Trade has led to concerns among Indian textile and apparel exporters who were looking guardant for a competitive vantage implicit Bangladesh with the 19% tariff for Indian goods successful the U.S. due to the fact that of the interim commercialized woody betwixt India and America.
According to the U.S.-Bangladesh Agreement connected Reciprocal Trade, “The United States commits to found a mechanics that volition let for definite textile and apparel goods from Bangladesh to person zero reciprocal tariff rate. This mechanics volition supply that a to-be-specified measurement of textile and apparel exports from Bangladesh tin participate the United States astatine this reduced tariff rate, but this measurement shall beryllium determined successful narration to the quantity of exports of textiles, eg. U.S. produced fabric and MMF textile inputs, from the US.”
India exported $1.47 cardinal worthy fabric yarn (570 cardinal kg) to Bangladesh, which is the biggest destination for Indian yarn, successful 2024-2025. It shipped 12-14 lakh bales of fabric to Bangladesh past year. Almost 20% of Bangladesh’s garment exports and 26% of India’s fabric apparel exports are to the U.S.
“I fearfulness that the contiguous interaction volition beryllium connected Indian fabric yarn arsenic Bangladesh tin bargain U.S. fabric and rotation astatine its textile mills,” said Chandrima Chatterjee, caput wide of the Confederation of Indian Textile Industry.
“A Bangladesh exporter tin usage 10% U.S. fabric and assertion that helium has utilized 100% U.S. cotton. How volition the U.S. find traceability of the earthy worldly ? As Bangladesh is precise beardown successful apparels, we whitethorn basal to lose,” said K.M. Subramanian, president of the Tiruppur Exporters Association.
The U.S. volition spot much import of Bangladesh garments that makes both, knitted and woven products. India volition suffer its competitiveness successful 100% fabric products specified arsenic T-shirts and tops successful women’s wear, said Sanjay K. Jain, president of the Indian Chamber of Commerce nationalist adept committee connected textiles.
But, determination are stakeholders who accidental the interaction whitethorn not beryllium much.
The textile mills successful Bangladesh are facing a situation due to the fact that of energy issues. Bangladesh should marque it competitory to bargain fabric from the U.S. and rotation the yarn, said a Coimbatore-based garment exporter.
“Bangladesh does not turn fabric oregon nutrient manmade fibre. It has to bargain MMF yarn oregon fabric from the US for the reciprocal tariff of 19 % to beryllium waived. But, the MFN complaint volition continue. The clip taken to person the U.S. fabric and the transport and retention costs should beryllium taken into consideration. Further, not each products tin beryllium made from American cotton. So, the merchandise premix should alteration and proviso concatenation should beryllium realigned successful Bangladesh. This volition not beryllium an overnight change. It volition each instrumentality clip and we should spot however applicable it is. This is going backmost to the quota authorities that existed earlier 2000,” said Siddhartha Rajagopal, enforcement manager of the Cotton Textiles Export Promotion Council.
According to A. Sakthivel, president of the AEPC, “There is an Executive Order by the US authorities issued past April that says that the advertisement valorem rates of work applies lone connected the non-US constituent of a product, erstwhile determination is astatine slightest 20 % worth addition. We volition entreaty to the Indian authorities to inquire for a proviso akin to the 1 fixed to Bangladesh for Indian apparel exporters too,” helium said.
