Preparation to provide relief to textile industry amid West Asia crisis
New Delhi: The Textiles Ministry is working on several relief measures to secure the supply of raw materials and reduce cost pressure amid the ongoing crisis in West Asia. The ministry has proposed reduction in import duty and some regulatory relaxations, so that the industry can maintain production and remain competitive in the global market.
The proposed steps include reducing import duty on rayon pulp and select cotton varieties, as well as temporarily suspending anti-dumping duty on certain types of yarn. Besides this, the Ministry has also sought removal of Minimum Import Price (MIP) on certain knitted fabrics in talks with the Agriculture and Finance Ministries.
According to an official, discussions are going on with the Agriculture Ministry regarding reduction in fees. While some parties are in favor of removing the duty due to inadequate production in the country, emphasis is also being laid on giving priority to the interests of farmers.
Meanwhile, readymade garments exports declined 19% year-on-year in March due to supply constraints and shipping problems in West Asia. In such a situation, the government is encouraging the industry to move towards new markets in East Asia.
It is noteworthy that last year the government had given exemption from 11% duty on cotton import for four months, so that the impact of American tariff could be balanced. India mainly imports special cotton varieties such as extra-long staple, often from the US and Egypt. At the same time, rayon pulp is mainly imported from Europe, on which currently there is a duty of 5%.
Recently, the government has also given full customs duty exemption on 40 petrochemical products in view of the situation in West Asia, 29 of which are used in the textile industry, especially in the production of man-made fibres.
Additionally, the Ministry is also in talks with the Finance Ministry for removal or deferment of the proposed anti-dumping duty on Elastomeric Fiber Yarn and Viscose Rayon Filament Yarn. These products are mainly imported from China and Singapore.
