India-UK FTA may unlock $1 Billion opportunity for Indian apparel exporters: MD, Gokaldas Exports
NEW DELHI : The India-UK Free Trade Agreement (FTA) could unlock a $1 billion incremental opportunity for India’s apparel sector by creating a level playing field with major exporters like Bangladesh and China, said Sivaramakrishnan Ganapathi, Vice Chairman and MD of Gokaldas Exports.
“I see this as almost a billion dollar opportunity for India… Bangladesh’s exports to UK, it’s almost $4 billion. China’s exports is $5 billion, and India is about $1.5 billion, or something like that,” he said during an interaction with CNBC TV18.
“Bangladesh is large thanks to FTA, thanks to duty free access to UK market… They have a 12% advantage over India, which now through this FTA is nullified. So, we get a level-playing field with Bangladesh. And currently, Bangladesh itself is facing some problems related to its own internal stability. On top of it, if India gets a level-playing field with Bangladesh through this FTA, there is a good likelihood that a lot more orders will get spread out between Bangladesh and India,” explained Ganapathi.
On May 6, India and the UK finalized a long-awaited Free Trade Agreement (FTA), with Indian exports set to gain from the elimination of duties on approximately 99% of tariff lines, effectively covering nearly the entire trade value. The agreement is expected to significantly boost exports in labour- and technology-intensive sectors such as textiles, marine products, leather, footwear, sports goods and toys, as well as gems and jewellery.
Highlighting the potential benefits, Sivaramakrishnan Ganapathi noted that the UK’s sizable Indian diaspora and existing collaborations between UK brands and Indian firms could see a strong boost with the FTA now in place.
“India has got a historically great affinity with the UK. There is a large Indian diaspora. UK understands India… if we get a duty free access into that country, I presume that there must be a lot more opportunity to source from India. In anticipation, several brands have been sourcing from India market now, this will get an incremental fillip and will rise very quickly,” he said.
Incidentally, most of the textile stocks were in the limelight on Wednesday, gaining strong ground following the improved sentiment around the sector on the back of India-FTA agreement.
Vardhman Textiles, Welspun Living, Arvind, and Raymond Lifestyles among others gained ground and closed in positive territory. While Welspun Living gained nearly 12 percent, Raymond Lifestyle was up more than six percent on Wednesday.