Textile exporters based in Tamil Nadu’s Tirupur have welcomed the India-US Framework Trade Agreement, saying it has helped the textile manufacturing sector compete with countries like China and Bangladesh, and expressed hope that the orders are worth it. ₹4,000 crore in withholding will be cleared after the tariff reduction that comes with the deal.
Tirupur has long been recognized as the center of textile production and export in the country. (Representative Image) (Unsplash)Textile exporters faced a 50% tariff, which came down to 18% on Saturday.
Tirupur Exporters Association president KM Subramanian said the joint statement by India and the US was “significant” and that “we welcome it” as it offered huge growth potential.
“This (agreement) alone will provide major growth for Tirupur. In the next 5 years, we expect exports from Tirupur to double,” he said, adding that Tirupur’s garment exports are currently worth ₹15,000 crores.
Subramanian, founder-chairman of Tirupur-based garment manufacturer KM Knitwear Pvt Ltd, is also optimistic that the deal will increase job opportunities. “Currently about one million people are employed in the industry and I am hopeful that if the momentum continues, another half a million workers will be added in the next three to five years,” he said.
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On the short-term impact, he said, “It will be visible in the next 3 months. After three months, we will be able to see good growth for garments shipped from Tamil Nadu. Tirupur’s growth will be at a higher pace from now on.”
Durai Palanisamy, president of the South Indian Mills Association, said the FTA with the US and Europe would create more demand from textile exporters due to increased competition in the sector.
Subramanian added that the existing orders will be cleared based on mutual understanding between the buyer and the exporter.
“Once the commitment is made, the existing stocks will be cleared,” he said.
M Rathinasamy, founder of Tirupur-based Starlight Exporters, said, “Earlier, orders for garment manufacturing were going to Bangladesh and other countries. But, after this deal, we will get more orders (from the US). He is hopeful that work on the pending orders will resume soon.”
Tirupur has long been recognized as the center of textile production and export in the country. Many manufacturers supply finished garments to Europe and the US, two major markets.
More than 55% of the country’s total cotton knitwear is imported from Tirupur.
