American clothing companies, scouting for greater investment opportunities in India following the US-China trade war, have made a case for a free trade agreement between the US and India to increase trade in the sector.

Other suggestions given by a group of fifteen American companies to Textile Minister Smriti Irani, during their meeting on Tuesday, was to improve the ease of doing business on the ground, provide higher skills to workers and draw up a sustainable growth plan for the sector, according to Tara Joseph, President, AMCHAM Hong Kong.

‘Opportunity for India’

“We are at an inflexion point. Manufacturing is moving away from China. There is a window of opportunity for India to attract investments in manufacturing. However, there is a lot of competition from countries like Bangladesh, Vietnam and Indonesia, and and India needs to do all it can to increase its relevance,” Joseph said addressing a press conference.

In the last four years, investments worth $30 billion in textiles had moved out of China because of various factors including rising input costs, but very little had come to India, Gautam Nair, Chair, CII Textiles Task Force, pointed out.

With the on-going trade war between the US and China, a greater number of American companies are looking at moving their investments from China. “On paper, India has significant strength and could be the natural successor to China. We have to speak with potential investors to find out why this has not been happening and act accordingly,” Nair said.

The delegation, which comprises representatives from American textile majors such as Ralph Lauren, the PVH Group (which owns brands like Calvin Klein, Timmy Hilfiger, Van Heusen and Arrow) and Carter's Inc, also discussed future possibilities with Niti Aayog CEO Amitabh Kant.

According to Joseph, an FTA between the US and India would promote business in the textiles sector. “Where there is a will, there is a way,” she said, on being pointed out that the two countries have not even been able to work out a limited trade agreement involving a few products.

The Amcham delegation also met the faculty of the National Institute of Fashion Technology (NIFT) to exchange ideas on the latest trends in design.