Knitwear exporters in Tirupur, a major Indian textile and knitwear hub, are looking forward to the new business opportunities with the Russian apparel market, following India’s decision to sign the Free Trade Agreement with Eurasian Economic Union (EEU), The Hindu newspaper reports.

As a prelude to the FTA with the EEU (comprising Russia, Kazakhstan and Belarus), a joint statement had been signed between India and EEU at the International Economic Forum that took place in St Petersburg in Russia, last month.

A joint study group will be established following the agreement to work out the formalities including the finalisation of the sectors that would be part of the FTA, the newspaper reports.

Market potential

Trade between Russia and India fell to US 9.5 billion in 2014 compared to US 10.1 billion in the previous year, according to the information provided by Russia's Ministry of Economic Development. During 2013-14, Russia has imported apparel items worth US 7.5 billion. India’s share in this was only US 268 million.

“We have already been representing to the authorities and made them convinced the need to have a FTA with Russia with textiles included in it, considering the immense market potential in that country,” T. R. Ramanathan, an industry consultant and senior member of Institute of Chartered Accountants of India, told the newspaper.

Talking to The Hindu, R. Dhanapal, an exporter, commented: “Once the FTA been signed, the exporters from clusters like Tirupur and its hinterland will be enthused to eye Russian market more because of the inherent incentives available in duty front under any free trade pact which makes the Indian products cost-competitive.”

Knitwear cluster

Tiruppur is known as the knitwear capital of India, accounting for 90% of India's cotton knitwear export. The region has spurred up the textile industry in India for the past three decades. It contributes to a huge amount of foreign exchange in India.

The local textile industry provides employment to over 600,000 people and contributed to exports worth US 3.2 billion in 2014-15.

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