Govt removes anti-dumping duty on viscose staple fibre

Govt removes anti-dumping duty on viscose staple fibre

Indian textiles and clothing industry has been facing several challenges especially on raw material front and could not achieve the envisaged potential growth rate both in the international and domestic markets.

Indian textiles and clothing industry has been facing
several challenges especially on raw material front and
could not achieve the envisaged potential growth rate
both in the international and domestic markets. The
industry has been pleading for a level playing field and
ensure global competitiveness to achieve the vision of
increasing the textile business size from the current level
of $ 164 billion to $ 350 billion by 2025. Historically, cotton
has been the engine of growth for the Indian textile
industry owing to availability of surplus homegrown
cotton at an internationally competitive price. In most of
the competing nations, MMF and its blended textile
product exports account 60 to 80% while in India, the
same is below 25% mainly due to the expensive raw
material.

Consequent to the meeting of the industry delegation
with the Prime Minister during December 2019 and
subsequent representations, the NDA Government has
been bold enough to remove the anti-dumping duty on
PTA, reject the proposed anti-dumping duties on PSF, MEG,
etc., that has made the polyester staple fibre and yarn
available at international price. However, the viscosestaple fibre attracted anti-dumping duty during the last
eleven years which curtailed the growth of this high
value-added textile segment. The Department of Revenue,
Ministry of Finance, Government of India has issued the
notification No. 44/2021-Customs (ADD) dated August 12,
2021 revoking the anti-dumping duty on VSF with effect
from the date of the Notification.

Ashwin Chandran, Chairman, The Southern India Mills’
Association (SIMA), said, “Unlike other manmade fibres, the
viscose staple fibre produced by a single indigenous
manufacturer was very expensive to the tune of Rs 20 per
kg, though recently the domestic manufacturer has
reduced the price to match with the international price to
a certain extent. The deemed export price concept
extended by the indigenous manufacturer greatly affected
the powerloom and downstream sectors, as the industry is
predominantly MSME and fragmented. Ashwin Chandran
has stated that anti-dumping duty on VSF ranged between
US $ 0.103 per kg and US $ 0.512 per kg.

SIMA Chairman has stated that the industry started
facing shortage of viscose fibres as the supply was
restricted to only around 200 spinning mills while the
polyester fibre was made available freely across the
segments. He has stated that the viscose staple fibre was
not made available for the MSME segment that greatly
affected the powerloom and the MSME garment sectors.
He has stated that the removal of anti-dumping duty on
VSF would greatly benefit the MSME segments.

Ashwin Chandran has stated that the Government has
recently announced the Production Linked Incentive
Scheme earmarking Rs 10,683 crores to attract large scale
investments in the MMF value chain by identifying 42 HS
Codes MMF apparels, 10 MMF Technical Textiles products
and 14 MMF fabrics. He has stated that as majority of
these products comprise of viscose and its blended textiles,
the anti-dumping duty removal would facilitate to achieve
the vision of creating 40 to 50 world champions in the
MMF products.

SIMA Chief has stated that VSF spinning segment has
been facing severe challenge due to duty free import of VSF
spun yarn from the ASEAN countries though it benefited
the powerloom and the downstream sectors. He has stated
that over two lakh powerlooms in Tamil Nadu have
migrated to VSF fabric production in the recent years andthe duty removal would encourage the power looms in
Tamil Nadu and other parts of the country to achieve an
exponential growth rate.

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