Complex Regulations Stalling Indian Garment Exports, Think Tank GTRI Reports

The Global Trade Research Initiative (GTRI) reveals that complex procedures from DGFT and customs, along with import restrictions, are hindering the growth of India's garment exports. High import duties and intricate processes force exporters to account for every fabric detail, causing delays and higher costs. The report calls for urgent reforms.

The Global Trade Research Initiative (GTRI) has highlighted significant challenges in the Indian garment sector, attributing stagnant export growth to complex procedures by the Director General of Foreign Trade (DGFT) and customs. The think tank pointed out that high import duties and stringent regulations force exporters to meticulously document every fabric detail, resulting in delays and elevated costs.

GTRI co-founder Ajay Srivastava noted that unlike in Bangladesh and Vietnam, Indian exporters struggle to access quality imported fabrics due to high import duties and intricate DGFT and customs procedures. He added that mandatory quality norms on raw materials further complicate the import process, making it essential for reforms to simplify these regulations.

The report called for a comprehensive overhaul of existing policies and suggested modifications to the production-linked incentive (PLI) scheme for the textiles sector. It also recommended adopting a system similar to Bangladesh's, where import entitlements are issued in value terms rather than actual consumption, and urged the government to eliminate redundant annual reporting requirements.

(With inputs from agencies.)