Ethiopia is beckoning garment exporters from India.
A combination of factors seems to be attracting exporters to Ethiopia. The country provides all the infrastructure with plug and play facilities, subsidised electricity and infrastructure. The labor is cheap and significantly Ethiopia enjoys duty-free export access to both Europe and the US, two major markets for garments. From Ethiopia exporters can ship garments without duty to these two major markets.

Indian garment exporters have suffered heavily due to competition from Bangladesh and Sri Lanka, which enjoy duty-free access to Europe.

Ethiopia is specially attractive to garment exporters from Tirupur, the knitwear hub of India, as they struggle to cope with GST and withdrawal of export incentives.

SCM Garments, based in Tirupur, has opened a garment unit in Ethiopia with 500 machines and 750 workers.

Tirupur, which accounts for 46 per cent of the total knitwear garment exports from the country, saw its exports decline by eight per cent 2017-18. The first quarter of this year saw a negative growth of 14 per cent. The hope is for a better second quarter.

Some of the big textile and garment manufacturers that have gone to the African country in recent times include Raymond and Arvind.