Developing nations talk common stance tomorrow

Against the backdrop of the scheduled onset of quota-free global textile trade next year, a four-day meeting of officials of developing countries begins here tomorrow to discuss among other things the feasibility of firming up a common plank.

Representatives of 80 countries, including India, Brazil, China, Pakistan, Thailand and Indonesia, are expected to attend the meeting of the International Textiles and Clothing Bureau (ITCB).

According to textile ministry sources here, the meeting will discuss ways to cope with tariff, non-tariff and other forms of hidden barriers to textile trade and if developing countries can work out a common approach to quota-free textile export era. The viability of such an approach would also up come up for deliberations, they added.

The meeting will also be used for consultations on Doha round of WTO issues relating to textiles.

Textile industry sources are keeping fingers crossed about the graph of Indian textile exports in the first nine months of the year 2005 when the quota is removed. But one thing is certain in the quota-free regime: Indian exporters cannot hope to go on exporting, banking on borrowed quotas against future quotas.

Apparel Export Promotion Council estimates that Indian textile exports in the financial year 2003-4 will be about 5.1 billion dollars, down from 5.3 billion dollars in the previous year. The figure is expected to be around five billion dollars in the current financial year.

The quota-free regime would mean two things for India: first in the short term, exports in value terms would come down with the removal of expenditure for quota management and secondly, in the long run Indian exports will become competitive with China on cost basis, industry sources say.

The main reason why Indian apparel exports is expected to get a cutting edge in the quota-free regime is the fact that its production is indigenous right from growing cotton seeds to manpower, the sources added.

India now accounts for just 2.5 percent of global apparel trade with main markets being the European Union and the United States with each accounting for 40 percent of total apparel exports.