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Indian textile and apparel exporters are busy tying up supply partnerships with Australian buyers even as the India-Australia interim free trade agreement awaits ratification by Canberra.

A delegation of apparel and textile exporters will leave for Australia around October-end to engage with and build the supply network with major clothing brands, in anticipation of the FTA.

Textiles and apparel are a big gain for India under the economic cooperation and trade agreement (ECTA) as the sector will enjoy zero-duty access to the Australian market when the deal comes into force. The department of commerce told Mint that government efforts to push textile and apparel exports have already picked up.

“India’s merchandise exports to Australia in 2021-22 has shown growth of 168% and similar growth was seen in the first quarter of FY23. The department of commerce in collaboration with the Indian High Commission in Australia and Export Promotion Councils has initiated action for enhancement of exports for textile and apparel sector. The department is tracking exports performance on a monthly basis," it said.

Preliminary talks for a full agreement—a comprehensive economic cooperation agreement (CECA)—have also started by both sides. “In the meantime, we are awaiting Australia’s ratification of India-Australia ECTA," it added.

The interim free trade deal, signed on 2 April, provides India duty-free access on 95% tariff lines, including textiles, leather, furniture, jewellery, machinery and medical devices. India has offered immediate tariff elimination on 40% of tariff lines comprising 85% of Australian exports in value terms. Another 30.3% of its tariff lines will see elimination or reduction of tariffs in a phased manner.

Narendra Goenka, chairman, Apparel Export Promotion Council, said the Indian apparel industry started reaching out to various brands in Australia to forge a supply network. Indian exporters will also participate in the apparel and textile fair in Australia in November. Separately, a delegation from India will meet major companies in Australia.

The industry is looking at 20% growth in exports to Australia in 2023-24. “Our industry is trying to contact buyers in Australia. Those already exporting to Australia will be expanding supplies. The business has not grown as much as we would have liked, but now with the interim FTA in place, we are quite hopeful of seeing a significant increase with anti-China sentiments also at a peak there," said Goenka.

He added that a delegation of Indian exporters will hold a meeting with “big companies" in Australia this October. “There are mass merchandising brands and also specific brands that we will be meeting and trying to push more business," he said. “We have informed the potential of Australian market to all our members, who are excited that there will be definitive growth."

A. Sakthivel, president of the Federation of Indian Export Organizations, said India’s apparel exporters will participate in the apparel textile fair in Melbourne scheduled around 20 November. “Once the ECTA is ratified, it will make way for more engagement between buyers and sellers on the two sides," said Sakthivel.

The ECTA is expected to be placed before the Australian parliament for ratification after it is examined by a standing committee. India’s textile exports had declined over the decades, with countries such as Bangladesh, Sri Lanka and Vietnam, emerging as large textile export hubs.

According to Morgan Stanley, the export share of low-skilled manufacturing goods (textiles, ready-made garments, gems & jewellery) has declined to 19.1% in FY21 from 28% in FY2010).

dilasha.seth@livemint.com

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