A new bilateral trade agreement finalised last year has boosted Australian exports of wool and cotton to India.
Tariffs on wool were dropped, leading to a 24 per cent increase in exports.
India is Australia’s third-largest cotton export destination.
Now, 51,000 tonnes of Australian cotton can enter India duty-free each year, with the elimination of an 11 per cent tariff.
The free trade agreement has helped farmers and Australian clothing brands.
The five per cent tariff on imported Indian clothing has also been wiped, which has led to a better deal at the cash register.
Marty Dillon said if the quota could be increased it would have more positive flow-on effects.
“[We would have] more spinning mills producing Aussie cotton, producing Australian cotton yarn,” he said.
“[That would] bring down lead times, reduce minimum order quantities, and increase competition.
“All of these are benefits that flow back to Australian brands.
Manish Daga said while it was a win for consumers, farmers would also reap the rewards.
“They make the backbone of the textile industry because they provide the raw material security to the country,” he said.
“Our focus right now [is on] how to make India and the world secure in terms of raw material, build marketing linkages, build relationships out of farm to fashions.”
Cotton Australia CEO Adam Kay said it was a notion cotton growers and wool producers were eager to hear. (ABC)
