US-China trade war to create opportunity for textile sector

The USA has hiked additional tariff to 25% on US$ 200 billion imports from China, which is an opportunity for the Indian textiles industry, said CITI chairman Sanjay K Jain.

He stated that due to the ongoing trade war between the United States of America (USA) and China, the USA has hiked additional tariff to 25% on US$ 200 billion imports from China, applicable from 10th May 2019.

He further stated that the additional tariff hike covers Textile Chapters: 50-60.

Jain observed that CITI’s analysis of Chapters 50-60 which are part of the list of notified US$ 200 billion imports from China and on which additional tariff has been increased to 25% (as given below in Table 1) reveals that India is at an advantageous position due to tariff hike on China’s Textile Products and we must grab this opportunity to increase our share of Textiles exports to the USA.

CITI Chairman mentioned that the value of above-mentioned textile products is approximately US$ 3.96 billion in 2018 which is only 2% of USA’snotified US$ 200 billion imports from China. Whereas, USA’s total imports of these textile products from India is approximately US$ 1.71 billion in 2018, which is 43% of USA’s imports from China.

Out of the total textile products, cotton textiles account for the largest number of tariff-lines (520 at 10 digit level). In terms of value, the most imported products belong to floor coverings, nonwoven cordage and manmade filaments.

Jain stated that the additional tariff hike does not include Garments and Made-ups Segments which means that there will be no additional advantage for the Apparel & Made-ups exporters from the above development.

He felt that the above-mentioned additional tariff hike provides an opportunity for the Indian Textile Industry to increase its exports to USA, particularly for the products belonging to the categories; cotton textiles, floor coverings, and manmade filaments.

Courtesy: SME Times