India's Trade Restrictions: A Boost for Domestic Apparel Industry

India's recent decision to impose trade restrictions on Bangladeshi goods is expected to benefit the country's domestic ready-made garment industry, especially micro, small, and medium enterprises (MSMEs), as stated by industry experts.

Announced on May 17, the restrictions target $770 million worth of imports from Bangladesh, which is nearly 42 percent of the bilateral imports. Critical goods like garments, processed foods, and plastics are now channeled through select seaports or completely rerouted from land routes. With this move, Bangladeshi garments, valued at $618 million, can now only be shipped through two Indian seaports, severely curtailing its principal export avenue to India.

According to Ajay Srivastava of the Global Trade Research Initiative, these port restrictions will assist Indian MSMEs in the textiles sector to balance the competitive disadvantage caused by Bangladesh's export subsidies and duty-free fabric imports from China, which provide a 10-15 percent price advantage.

(With inputs from agencies.)