Effect of policy on export competitiveness: case of the Indian garment industry

Abstract

The paper argues that policy should enable and encourage large firms to play a more active role in garment exports. This will allow India to exploit the high-volume segments of the world market more fully and appropriate a higher share of the value addition in the export chain. The paper proposes some measures for making the institutional arrangements for production and input supplies more efficient, so that exporters may capitalise on Indiazs comparative advantages and bypass disadvantages. The question of developing constructive linkages between large and small firms is also dealt with in this context.