Export of readymade garments to India drops

KATHMANDU, OCT 11: 

An unexpected decrease in the export of Nepali readymade garments has shattered the expectations of Nepali exporters of making India its next prime export destination.

According to garment exporters, due to non-tariff harassment, garment exporters are using illegal channels to 

export their products to India, due to which real figures may be missing from the available original export data.

“We are quite surprised with the changes in the export figures to India,” said president of Garment Association – Nepal Uday Raj Pandey, adding that the demand for Nepali readymade garments is good in India. 

“We had high expectations regarding garment exports to the Indian market but the reason behind the drop is yet to be identified,” he said.

According to Pandey, India was identified as ‘destination next’ for garments and the association was expecting an overall export figure of around Rs 800 million to Rs 900 million in the fiscal year 2011-12. 

However, annual export figures of Trade and Export Promotion Centre state that in the fiscal year 2011-12, garment worth only Rs 332 million was exported to India. 

“We are planning to interact with exporters and concerned authorities to identify the exact reason behind the drop,” Pandey said, adding that they had heard that due to non-tariff harassment at Indian customs, exporters preferred to export garments through illegal channels because of which the actual data has not been recorded.

After India’s decision to end additional customs duty on 162 Nepali exportable items, garment industrialists were looking forward to more opportunities in the Indian market. 

However, due to unidentified reasons, garment industrialists of the country are now worried about the failure of Nepali readymade garments to pick up pace in the Indian market, where demand for Nepali garments has always been high. 

“The removal of additional customs duty has definitely benefited the garment industry, but to make Nepali garments more competitive we are also asking for a removal of the countervailing duty of four per cent which is imposed on products that are under excise in India,” said Pandey. 

Besides traditional markets like America and Europe, the Nepali readymade garment industry has also identified Australia and South Africa as promising destinations.

Source: THT