Customs duty advantage under the India-Australia free trade agreement will help Indian apparel exporters get greater market access in that country as compared to their competitors, AEPC said on Tuesday. The agreement is coming into force from December 29. Apparel Export Promotion Council (AEPC) Vice Chairman Sudhir Sekhri said Australia is the largest importer of garments in the southern hemisphere. While China’s share in import of apparel into Australia is more than 70 per cent, India’s share is less than 5 per cent.
“With the India-Australia ECTA (Economic Cooperation and Trade Agreement ) getting operationalised, India will have a slight duty advantage over Vietnam and Indonesia for imports in the Australian market,” he said. India’s ready-made garment exports to Australia have seen a growth of an average of 11.84 per cent over the last 5 years, which is “purely on account of China Plus One strategy adopted by most countries,” he added. Going by this growth trend and with the agreement coming into play, AEPC believes that the exports to Australia would grow three times by 2025, the Vice Chairman said.
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An outreach programme with apparel exporters was organised on Tuesday by the Department of Commerce in association with AEPC and Okhla Garment Textiles Cluster (OGTC). OGTC President PMS Uppal said most of the big Australian companies have deep roots in China and they will only be considering India as an option if “we give them lucrative incentives and reasons to shift to India for sourcing their requirements”. The government has assured AEPC that it will look into the challenges and respond positively.
FinancialExpress.com adds…
Earlier, the Central Board of Indirect Taxes and Customs had notified the Rules of Origin. The notification relates to the eligibility requirement to claim the preferential customs duty on trade in goods, under the economic cooperation and trade agreement (ECTA). RoAs specify the threshold for value addition in the country concerned to qualify for the tax concessions under the FTA, so that the benefits are not misused by firms based in other countries.