Vietnam is $24 billion in garment exports and very important textile hub. We are $18 billion. Our textile export is $40 billion but our garment exports are only $18 billion. So they are bigger than us. Now, they will have the access to the American markets. Now if I have to sell a pair of jeans out of India into America, I am paying 17 per cent duty. Now this is prohibitive and if I am selling a branded fabric which is polyester-rich, more than 50 per cent polyester, then the duty is 33 per cent. Now India cannot have access to the two largest markets—Europe, which has 10 per cent duty, and America, which has 17 per cent duty as far as cotton is concerned unless we sign these treaties.
Vietnam can’t buy yarn from us because of the treaty. Vietnam is a huge garment exporter and will be cheaper than us because of favoured duties. At some level, this agreement can make life a lot more difficult for us. The tariff wars are here again.
Free trade agreements that exclude us may be okay for us to continue to produce cheap drugs, but it’s not okay for textile exports.
And that warning isn’t adequately reflecting in textile stock valuations. Be warned!