Indian, Chinese textile producers gain, post-quotas: ILO

According to the Geneva-based International Labour Organisation (ILO), China and India are the main beneficiaries of the end of global trade quota system for textile and clothing.

India has increased its share of textile and garment deliveries to the US and European Union by a quarter in the first half of 2005. But China's share of the US market has increased by two-thirds, giving it a market share of 28 per cent in the US.

The EU negotiated a "special" quota deal with China in June to stem the flooding of its markets with Chinese textile and garments. India tries to maintain modest profile in the European market place. However, many key Indian textile manufacturers are trying to concentrate on "quality and up-market" products. Although Indian fashion designers, mainly based in Mumbai and Delhi, are trying to increase their profile in key European fashion markets, they have "a long way to go" before they consolidate their presence and profile in the European market place.

With rising sales of textile and garment products from China and India, there is also demand for protectionist legislation in some centre-right European business and political quarters. At this stage, this is a "tiny minority", as key government officials on both sides of the Atlantic argue the case for free trade.

China and India are seen making gains at the cost of other Asian exporters such as Bangladesh, Pakistan, Sri Lanka and Cambodia, according to the ILO report. Apart from these countries, the main losers since the lifting of the quotas have been smaller textile and garment producers of Africa, the Americas and Europe.

Business Line