Pakistan and China have dealt a severe blow to Indian cotton yarn exports in the first half of the fiscal year 2019. Exports of cotton yarn from India shrunk 38.8% in the said period.
According to a report, India exported 422 million kg of cotton yarn worth $1.27 billion between April and September this year. During the same period last year, India exported 654 million kg of cotton yarn valued at $2.08 billion.
The report highlights that the China-Pakistan Free Trade Agreement (FTA) has played a key role in shrinking India’s export of cotton yarn.
The free trade agreement was signed in April this year. Under the agreement, Pakistani goods worth $64 billion got duty free access to the Chinese market. A large part of these goods belonged to the textile sector.
Chairman of the Cotton Textiles Export Promotion Council, K V Srinivasan, said that ever since the second phase of China-Pakistan FTA came into effect, India’s cotton yarn exports began to decline.
Major markets like the EU, China, South Korea, and Turkey levy 3.5% to 5% of import duties on cotton yarn imported from India. Pakistan has duty free access into these markets, another reason mentioned by K V Srinivasan behind India’s declining cotton yarn exports.
Via: Daily Times