Indian garment business response: perceptions on the emerging issues the post‐MFA scenario

Garments industry is important for developing countries as well as developed countries as it contributes significantly to the employment generation and economic growth. This industry has long been regulated by consecutive international agreements such as Multi Fiber Arrangement (MFA), which is scheduled to be phased out by 2005. Thje dismantling of MFA (quota) regime seems to bring more threats to developing countries. Emerging issues related to environmental and social compliance (e.g. minimum legal wage, employee’s work life, health), technology requirements etc. have been brought into surface by the importing countries fiz. developed countries. Although it is too early to predict, the adverse effect has been felt by India since the beginning of MFA phase out. The aim of this study is to assess the understanding and responses of the garment exporters in India towards the emerging issues. Factor analysis was used in this analysis. Construct validity and sample adequacy were performed using KMO value. Six factors have emerged from the analysis. On the basis of these six factors, the perceptions of the importers in India were also analyzed and subsequently compared the same with the exporters’ perception. Under Radar Diagram the results of the difference have been analyzed.