The apex textile industry body said that while the ongoing US-China trade war presents an opportunity to Indian textile manufacturers to enhance their exports to the US, China too would be looking for new markets for its products.
Confederation of Indian Textile Industry (CITI) has cautioned the government to tread carefully while negotiating for the proposed Regional Comprehensive Economic Partnership (RCEP) trade agreement and not to cede space to China in the global textiles and clothing (T&C) sector. “India’s trade deficit with China in the textiles and clothing sector is likely to be widened once RCEP is concluded and could be detrimental for its domestic textile manufacturers,” said CITI Chairman Sanjay Jain.
The textile industry body said that while the ongoing US-China trade war presents an opportunity to Indian textile manufacturers to enhance their exports to the US, China too would be looking for new markets for its products. “The RCEP trade scenario reveals that India must tread cautiously, particularly with China, as half of India’s T&C trade in RCEP is with China, with which it had a big trade deficit of almost $1 billion in 2018”. This is critical as China is already re-routing its textiles into India through Bangladesh and Sri Lanka.
India registered trade deficit in 2018-19 with as many as 11 Regional Comprehensive Economic Partnership (RCEP) member countries – including China, South Korea and Australia – out of the grouping of 16 nations that are negotiating a mega trade pact since November 2012. The RCEP bloc comprises 10 ASEAN members and their six FTA partners – India, China, Japan, South Korea, Australia and New Zealand. There is pressure on India to conclude the pact this year amid domestic industry especially steel, aluminium, copper and dairy opposing it.
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