The Indian government is considering the abolition of the requirement for textile exporters to produce a letter of credit (L/C) in order to obtain an allocation to export goods restricted by quotas.

According to India's textiles minister, Kashiram Rana, this measure could help boost exports that have suffered in the worldwide economic slowdown.

Productivity

Rana said abandoning the L/C condition was one of a number of measures under active consideration to boost exports.

The minister also urged the textiles industry to take radical steps to improve productivity, quality and service to tap the US$200 billion world clothing market. India's share of that market is around US$5 billion.

Upturn

Data compiled by the Apparel Export Promotion Council indicates that quota exports during April-June 2002 amounted to US$1.01 billion, an increase of 7.5 per cent of the previous quarter.

Rana has said that the government would do away with the L/C condition for obtaining an allocation under the first-come-first-served quota system if textile exporters accept the proposal.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.