chapter  9
Safeguard measures for textiles: product specificity
Pages 15

The story of industrialisation began with the industrialisation of the textile sector. Industrialisation of the textile sector was also the fi rst step towards industrialisation by the developing countries after second half of the 1940s who had hitherto been colonised. Blessings of the modern technology combined with the traditional artistic skills of relatively cheap labour made the products of countries such as India and China very competitive in the international market. This invited a protectionist backlash from the United States and Europe and in the 1950s Japan, China, Hong Kong and Pakistan agreed to VERs for cotton textile products to the United States. A GATT report notes the arguments that were used by the proponents of protectionist regime in the textile sector. The proponents of textile quota regime were concerned that developing countries often fi nd it most convenient to begin their industrialisation in the textile sector, because the machinery to do so is not too complex, and because clothing for the domestic market is an important marketing consideration. Thus, low-wage textile employees in developing countries became a threat to textile workers in developed countries. But the GATT report notes that this argument holds good only as long as the production of textiles is dependent upon abundant low-skilled labour. Increased levels of automation in the textile industry have possibly moved the comparative advantage back to industrialised, developed countries.1