India’s textile and apparel exports fell by eight per cent from April to November 2019. Exports were severely affected by the trade conflict of the US with China, the EU’s struggle with Brexit, growing geopolitical tensions in the Middle East and the removal of GSP benefits to India by the US. Under GSP, developed countries grant import duty concessions, in addition to prioritising purchase of textile and apparel products from some countries.

The delay in announcement of Remission of Duties or Taxes on Export Products is set to result in a further three per cent or four per cent contraction in apparel exports. Many textile players signed export contracts on expectations of continuation of the Merchandise Exports from India Scheme (MEIS), and the Remission of State Levies scheme. The delay in announcement has blocked the working capital of exporters. Since cotton yarn bears the same incidence of state and central levies, similar to made-ups and garments, the industry wants cotton yarn to be covered under the Rebate of State and Central Taxes and Levies Scheme and MEIS and also under the three per cent interest equalisation scheme.

India’s apparel exports to the US rose six per cent in April to November.