According to Office of textiles and Apparels (OTEXA), the first year of the non-quota regime for textiles has seen Indian exports to the US grow by 27 per cent year on year, to $4.6 billion (Rs 20,425 crore), while China’s exports to the US in the same period increased by 54 per cent to $22.4 billion. The pace of domestic exports has picked up significantly in the last quarter since they rose just 20 per cent between January and September 2005 and 24.18 per cent between January and June 2005. Indian textile firms have also sold 2,335 million square metres in 2005, a rise of 22 per cent year on year, compared with an increase of just 15 per cent in 2004. China was expected to be the biggest gainer after phasing out of the Multifibre Agreement, given its far higher capacities and competitive pricing. India too was
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Quota premiums in the apparel category accounted for as much as 25-35 per cent of the selling prices in a quota regime and consequently ate into profit margins. That problem appears to have been resolved: Indian firms sold apparels worth $2.97 billion in 2005, an increase of over 34 per cent, compared with a growth of just 10.7 per cent in 2004. The story has been somewhat different for non-apparels which grew at a lower rate of 15.8 per cent in 2005, compared with 17 per cent in 2004 in value terms. Industry observers say that total exports of textiles could grow as much as 35 per cent over the next few years with its share doubling from the current four per cent in five years. While China’s growth could be much higher, India firms may benefit from US imposing restrictions on Chinese textile exports in certain categories. 
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