The FTA between India and Association of South East Asian Nations (ASEAN), allows most cotton, woven cotton fabric and knitted fabric imported from India to relish tax exemption from January 1.
Vietnam is a key importer of India’ cotton fabrics and will be able to procure it without any taxes soo n.Markedly, India fetched US $ 257 million from selling garments and textile products to Vietnam between April and August of the current fiscal, up by 59 percent from the last fiscal.
Additionally, in FY 2017-2018, India’s exports of garments and textile were worth US $ 555 million to Vietnam, up 42 per cent over the previous fiscal.
The FTA may further improve these figures as Vietnam is emerging to be the world’s second biggest garment exports destination and for that to maintain, the garment manufacturing hub need a hefty supply of raw materials such as cotton fabric, and this is where India can play a vital role.