What seemed to be a lucrative as well as a burgeoning market in the European Union (EU) for textile and apparel manufacturers will not be the same again. This is because of the EU's imposition of tougher laws on chemicals and their safe use, many of which are used in apparel printing and design.
Industry experts believe that the regulation, called Registration, Evaluation, Authorization, and Restriction of Chemical Substances (REACH), would deeply affect the business of small and mid-sized textile and apparel companies in India. Import/export ties between the EU and India will also be significantly affected, once the law comes into full force.
On December 1, 2011, it will be mandatory for apparel manufacturers, as well as exporters, to notify the European Chemicals Agency (ECHA) if their products contain a substance on the Candidate List of hazardous chemicals.
Dye and pigment manufacturers will have enough reason to worry, as their products, which are considered to be potentially harmful, will come under the scanner. In this context, Viral Trivedi, manager at Dyes Sales Corp. in Mumbai, says, “REACH regulation will create considerable confusion among the small and mid-sized dye and pigment exporters in the country, since most of these manufacturers are less aware of such regulations.”
It is feared that companies that would not comply with the REACH regulation would be heavily penalized.
“The government should immediately organize some awareness camps for the benefit of dye and pigment manufacturers in the country," says Rajesh Shah, managing director of Meera Dyestuff Industries, a mid-sized dye manufacturer in Ahmedabad. "Otherwise, many exporters will turn up paying penalties as high as €75,000 ($107,500) per consignment.”
According to the Apparel Export Promotion Council (AEPC), export costs will double after the implementation of the law, but the manufacturers have to comply with the new regulation in order to grab the large European market.
The REACH regulation went into force in June 2007 and will take 11 years for all of its provisions to be implemented. The prime objective behind this law is to protect people and the environment from the harmful effects of hazardous chemicals. In principle, REACH applies to all chemicals: not only chemicals used in industrial processes but also in our day-to-day life, for example in cleaning products and paints, as well as in clothes, furniture and electrical appliances.
More information is available in the ECHA's Fact Sheets that provide a structured overview of REACH guidance documents published by the agency. They include a summary of the key aspects, bibliographic information, and other references.
David Parks is a well known author and has written articles on IT companies, B2B Portal, Investment Guide, suppliers, and manufactures.
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