Indian apparel exporters have welcomed an agreement to boost trade with Japan, which was signed last week.

The Comprehensive Economic Partnership Agreement (CEPA) is one of the largest agreements ever signed by India, and sets the stage for free bilateral trade of goods and services between the two countries.

Under the pact, around 94% of the tariffs between Japan and India will be eliminated within 10 years. For garments, all items falling into customs categories 61 and 62 (knit and woven garments), are now duty free. 

Talks on the CEPA began in November 2004 and were followed by 14 rounds of negotiations before the agreement was finally signed on Wednesday (16 February).

According to industry group the Apparel Export Promotion Council (AEPC), Indian garment exports to Japan are worth around US$125m a year, making India one of the country’s top five apparel suppliers.

Shipments are almost equally divided between knitted and woven garments, with synthetic dresses the single largest category in terms of quantity and value.  

Mr Premal Udani, chairman of AEPC, believes India’s garment exports to Japan are likely to rise by nearly 50% now that duty rates of around 11% no longer apply. 

He also said that AEPC is planning to at the International Fashion Fair in Tokyo in July, and has already met with major buyers like Fast Retailing, which operates the Uniqlo casual clothing chain.