NEW DELHI: In a bid to grow its ready-made garment exports, India is looking to tap Iran’s market for simple apparel products following the removal of economic sanctions against the country last year. An exploratory visit to Iran earlier this month saw India’s Apparel Export Promotion Council (AEPC) and the Tehran Chamber of Commerce and Tehran Textile Union discuss how to reduce tariffs and facilitate market access.
Iran has seen a progressive reduction in tariffs from 300% during sanctions to the present 55%. The high tariffs had resulted in “unofficial” imports being over ten times the volume of “official” imports. As a result, the trade associations have been working with the government to reduce import duties to international levels. This has become necessary given Iran wants to be a part of the World Trade Organization (WTO) and hence align with its tariff levels.
Ashok Rajani, chairman of the AEPC, said the positive attitude towards India among the members of the trade associations and government representatives “augurs well” for trade between the two countries.
“Although the economy and trade is still recovering from the impact of the sanctions, there is a market for simple but stylish apparel products, which AEPC plans to tap,” he added. India’s share of Iran’s RMG imports was 2.5% in 2015, while Iran’s RMG global imports grew 43.3% last year, increasing to US$825.9m from $576.2m in 2014.
“Although it is small market at present, there is scope for growth in the immediate future and we want India to be an important partner in this growth,” said Rajani. The council has drawn up its export promotion programme for the year 2016-17 with a view to achieving an export performance of $18.75bn in the year 2016-17. Nasrollahi, general director of textile and clothing for Iran’s Ministry of Industries, said: “India has a lot to offer and could complete the apparel value chain in Iran.”
