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Garment Makers Shift Focus from Gujarat to West Bengal

By   /   February 16, 2016  /   No Comments

Dhaka, Bangladesh – The Daily Star reports that Garment makers are no longer interested in setting up a warehouse in the Indian state of Gujarat and are now looking at West Bengal due to its proximity to Bangladesh. FBCCI President Abdul Matlub Ahmad, who has been lobbying the Indian government for the warehouse in Gujarat, said the facility in Gujarat will not be beneficial for Bangladesh due to the long distance.Besides, the Indian government is more interested in allocating the land for setting up factories, and not the warehouse, said Siddiqur Rahman, president of Bangladesh Garment Manufacturers and Exporters Association. “There are a lot of investment opportunities in Bangladesh now.” Earlier, during Indian Prime Minister Narendra Modi’s visit to Dhaka in June last year, Bangladeshi garment makers demanded 50 acres of land in Gujarat to build a warehouse to supply apparel items directly to retail shops across India.

The plan for warehousing came as Bangladesh seeks to boost its annual garment exports to the Indian market to $1 billion in three years from present $100 million. India is a very big market for Bangladeshi apparel exporters, as its annual retail market size is set to cross the $40 billion-mark thanks to its growing middle-class, according to the industry insiders. Setting up the warehouse instead in the Indian state of West Bengal would be commercially viable for Bangladeshi garment makers, said Ahmad, also the immediate past president of the India-Bangladesh Chamber of Commerce and Industry.

Subsequently, he proposed the idea of the warehouse in West Bengal in a business summit last month, and the government of the Indian state also showed interest in allocating the land for it. If the West Bengal proposal goes ahead the exporters can also set up a garment park there, he said. Although India provided duty-free and quota-free market access for all Bangladeshi goods except 25 alcoholic and drug items in 2012, it levied 12.5 percent countervailing duty the following year, which hampered garment exports.

Bangladesh exported garment items worth $104.25 million to India in fiscal 2014-15, up 8.3 percent year-on-year. The country’s overall exports to India were worth $456.63 million in fiscal 2013-14, compared to $563.97 million a year earlier. Bangladesh’s imports from India were recorded at $6.03 billion in fiscal 2013-14 and $4.78 billion a year earlier, according to data from the commerce ministry.

Source: The Daily Star

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