(MENAFN- KNN India)
New Delhi, Jul 26 (KNN)
In a move to enhance India's competitiveness in the global apparel and footwear market, Finance Minister Nirmala Sitharaman has announced significant import duty exemptions on raw materials for these industries.
This decision is expected to make Indian products more price-competitive against major exporters like Bangladesh, Vietnam, and China.
The government has introduced customs duty reductions on various raw materials crucial to the apparel and footwear sectors. These include Methylene Diphenyl Di-isocyanate (MDI) for Spandex Yarn, real down-filling material for winter wear, wet white, crust, and finished leather, as well as accessories and embellishments for garments and footwear.
Industry experts estimate that these exemptions could reduce manufacturing costs by 2-4 per cent, potentially increasing India's appeal to global brands like Zara, H&M, and Gap.
Currently, India holds a 3.5 per cent share of the global apparel trade, with exports valued at USD 16 billion. This figure pales in comparison to Bangladesh's exports of over USD 40 billion and China's impressive USD 120 billion. The new measures aim to narrow this gap and boost India's standing in the global market.
The Tiruppur Exporters' Association, a key player in India's textile export industry, has set an ambitious target for the coming year. They aim for a 10% growth, pushing their export value to Rs. 40,000 crore. This goal aligns with the government's efforts to stimulate the sector's growth through policy interventions.
Industry leaders are optimistic about these measures, believing they will significantly improve India's competitiveness. This is particularly crucial as global brands are actively seeking alternatives to traditional manufacturing hubs like China and Bangladesh.
The timing of these exemptions could position India as an attractive option for international fashion retailers looking to diversify their supply chains.
In a move to provide long-term stability to the industry, the government has extended the basic customs duty exemption on specified goods for export-oriented manufacturers
until March 31, 2026.
This extension offers a broader window for businesses to plan and capitalise on these benefits.
While some industry experts view this as a significant opportunity for growth, others suggest the financial impact may be limited. Nevertheless, there is a consensus that the move will enhance India's reputation as a sourcing destination and improve ease of doing business for global brands.
As the industry adapts to these changes, it remains to be seen how effectively India can leverage these incentives to boost its position in the global apparel and footwear market.
(KNN Bureau)
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