Garment Industry Sees New Hope 300k more jobs expected

Garment Industry Sees New Hope 300k more jobs expected
(New Business Age, March 2008)

Nepali readymade garment industry is expecting a speedy revival from present slump if the plans of India’s Reliance Group and America’s Shah Safari (SS) Inc. really get materialised. According to the sources, once the plans of these two buyers get materialised, Nepali garment industry will create nearly 300 thousand new jobs.

Enthusiasm among Nepali garment entrepreneurs soared up following a promise from Reliance Company, India to help rehabilitate the Nepali garment industry and buy the garments produced here. Likewise SS, based in Seattle, USA, too has a plan to set up a manufacturing facility in Nepal, say the industry sources.

Two representatives of Reliance visited Nepal recently and apprised themselves of the situation by meeting the industry leaders and the government officials, according to the same source. ‘They praised the quality of the Nepali garments and showed eagerness to place long-term orders which would engage 150,000 machines,’ said Prashant Pokhrel, the newly elected President of Garment Association Nepal (GAN), who had a meeting with the Reliance representatives Bipin Tyagi (Vice President) and Manas Sen (Quality In-Charge).

“If we get work only for 50,000 machines, that will be enough for us to be in the situation before the ongoing slump in the Nepali garment industry started,” Pokharel added. According to him, as one machine needs two persons to operate, the Reliance order, if materialised, will generate 300,000 jobs.

Pokharel also informed that while Reliance has already placed orders for samples, SS has appointed a local agent to negotiate with the garment manufacturers.

Similarly, other Indian companies such as Vishal, Megamart, Century and Pantaloon too are learned to be interested to source garments from Nepal

At present the Indian companies are sourcing readymade garments from Bangladesh, under a quota restriction of 8 million pieces, exceeding which attracts 15 percent duty. But as there is no such quota restriction in importing garments from Nepal to India, Nepal has become an attractive source for the Indians, say the industry sources.