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Tuesday, Feb 03, 2004

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JC Penney to increase textile outsourcing from India

Our Bureau

New Delhi , Feb. 2

US mega department store chain JC Penney Company Inc is planning to increase apparel outsourcing from Indian companies.

Addressing a news conference here to announce the plans of the world's largest importers of readymade garments with nearly 1,100 stores all over the US and a turnover of $38 billion, the JC Penney company's Vice-President-cum-Director Strategic Sourcing, Mr Rodney M. Birkins, said the company proposes to step up its current sourcing of Indian apparel from $200 million to $600 million over the next two to three years.

Mr Birkins said that the end of the quota regime by the dismantling of the Multi-Fibre Arrangement towards the close of this year would see a lot of activities of foreign retail companies flocking to India to divert a major part of their sourcing to India. "India has come very high on our plans with quota restrictions going away, we expect competition to significantly increase." He said that a team of a large contingent of sourcing officers of JC Penney is already in India, visiting various apparel hubs such as Ahmedabad, Ludhiana and Tirupur.

Mr Birkins said the focus is on woven products, knit shirts and home textiles (home furnishings) — the three core products of JC Penney. Though China accounts for 30 per cent of the company's apparel sourcing, he said "this will go a little but not much" in the future as China has become a WTO member and would be subject to safeguard measures by importing countries. On the other hand, the Indian garmenting industry has become a big competitor in the global markets and "we expect this country to account for one-third of our apparel sourcing" in a couple of years from now, he said.

The Apparel Export Promotion Council (AEPC) Chairman, Mr A. Sakthivel, who was present at the briefing, said India is going to play a major role in the world apparel market after 2004.

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