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G. Gurumurthy

TIRUPUR, Sept. 26

IN anticipation of the changing contours of textile/garment trade beyond 2004, Tirupur knitwear exporters are attempting to try out warehouse stocking in Europe that could facilitate stocking of knitted garments shipped from Tirupur and just-in-time catering to their buyers who mind tight inventories.

"We are looking at the scope of having a land duty paid (LDP) stocking facility in Europe where we can store finished knitwear goods for our buyers there. This kind of stocking could be done initially by leasing out storage space and subsequently we can go for our own accommodation," the President of the Tirupur Exporters Association (TEA), Mr A. Sakthivel, said.

TEA has deliberated on this with the India Trade Promotion Organisation (ITPO) Chairman-cum Managing Director, Mr Vasudevan. The ITPO Chairman had sounded the Tirupur garment exporters on the viability of such a venture, as part of the market development effort to beat the challenges in the post-quota regime beyond 2004 for textile and clothing industry.

The thinking among TEA members is that after launching a garment warehousing for Tirupur products in Europe, they could rope in ITPO as a joint partner for the venture and benefit from the latter's expertise on such off-shore garment warehousing.

The initial investment, if TEA opted for a leased storage space, would not be huge and could be shared between TEA members and ITPO. "We'll be asking ITPO to do a study on the scope of this venture," the TEA president said.

EU remained the single largest export market for Tirupur knitwear and this status is expected to be intact even after the 2005 free trade regime. The setting up of an LDP stocking facility in Europe may become an additional market-support mechanism for Tirupur exporters, as it will encourage the small garment importers from Europe to draw their required supplies straight from the LDP storage point.

The Tirupur suppliers could send their garments produced in off-season to the warehouse which could also be used to accommodate the stocks resulting from order cancellation.

The TEA President said Rotterdam could be the ideal location to set up such a warehousing unit. Tirupur garment exporters are also hoping to fall back on the market development assistance or initiative (MDA/I) scheme from the Union Commerce Ministry for this effort.

Mr Sakthivel, who was addressing media persons here on Wednesday about the forthcoming `India Knit Fair' for the winter collection scheduled to be held between October 9-11 in Tirupur, said he hoped that once the feasibility of the venture was established, his association would initiate work in two months' time.

This facility is being thought of as a vehicle to test the surge in clothing trade anticipated in the interregnum periods between the last phase of quota abolition and the quota-free trade regime soon after the 2005.

While Tirupur knitwear exporters could, if the offshore warehousing is proved viable, store the non-quota categories of items, it is not clear yet as to how they will be permitted to stock certain `sensitive' categories of garments coming under quota restrictions.

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