New Delhi | The proposed free trade agreement with the UK and the European Union will be a game changer for the domestic industry and will offer a huge advantage for apparel exporters, AEPC said on Saturday.

Apparel Export Promotion Council (AEPC) Chairman Naren Goenka said that trade pacts with the UAE, Australia and Japan are providing market access for the sector.

"The FTA with the UK will be a game changer for the industry, and the EU will offer a big advantage if we sign an FTA deal," he said.

The negotiations for the trade agreement with the UK are in the last stage and talks with the EU are moving at a faster pace.

He also said that one of the major issues regarding the poor export competitiveness of Indian apparel is poor economies of scale.

The apparel industry comprises 80 per cent of exporters with around Rs 10 crore turnover and the average number of machines in Indian apparel manufacturing units is 250-400, whereas competing countries have an average of 800- 1000 machines.

"Also, there are hardly any vertically integrated units unlike in Vietnam and other competing countries. Both these factors limit the capacity for the industry to invest in productivity enhancement technologies," he said.

He was speaking at the AEPC exports awards to exporters on December 8 here.

The awards recognize contributions made by Indian apparel exporters in building modern export enterprises and helping to further develop a unique export culture.