The 15 member European Union has decided to permit the import of additional 3,500 tonnes of Indian textiles in 2003.

The decision was taken this week, ahead of the EU-India Summit later this month. Officials said that with the latest quota flexibility, 8,000 tonnes of additional quotas have been provided to India.

Senior government officials told Business Standard that the decision comes after weeks of negotiations and the EU decided to delink multilateral matters with bilateral issues.

Exporters, particularly from the textiles sector, have been complaining of the adverse effect of appreciation of the Indian rupee to the dollar. Data compiled by the textiles ministry points to higher realisation from quota exports, though quota utilisation has dropped by 5.35 per cent in three principal markets -- Canada, the United States and EU.

During January-October 2003, utilisation of export quotas to these three countries was estimated at 87.28 per cent of the agreed level, compared to 92.21 per cent in the corresponding 10-month period last year.

Quota utilisation by Indian exporters to the EU was estimated at 99.11 per cent during January-October this year compared to 99.19 per cent in the corresponding period last year while realisation from the export of these items is estimated to have risen 18.87 per cent to $ 4.22 billion. Export of items like sweat shirts, blouses and gents shirts witnessed significant increase.

The maximum decrease was witnessed in case of the US, with quota utilisation dropping to 83.35 per cent during the first 10 months of 2003, compared to 92.52 per cent in the corresponding period last year, representing a 9.91 per cent decrease.

Quota exports to the US were estimated to have increased by 5.56 per cent to $ 4.75 billion during January-October 2003 compared to $ 4.5 billion in the corresponding period last year. Officials said that the decrease in exports could be attributed to unusually lower temperatures in the US during summer months resulting in a lower export of cotton garments. Besides, some least developing countries, which have received duty-free access, have affected India's exports.

Export of jackets, sweaters, trousers and shorts have, however, increased during the period. Trousers and shorts exports to the US have increased by 21 per cent during the 10-month period.

In case of Canada, quota utilisation dropped to 52.24 per cent during January-October 2003 compared to 55.4 per cent during the corresponding period last year while realisation rose 4.25 per cent to $2.21 billion.