Southern India Mills Association (SIMA) today thanked union finance and textile ministers and also GST council for increasing the Basic Customs Duty on polyester fabrics from 10 per cent to 20 per cent thus encouraging “Make in India” programme of the Government.

Since man made fibre price in India was expensive by 20 per cent to 30 per cent due to high incidence of duties and levies, there was a threat of cheaper imports especially countries like China, SIMA Chairman, P Natararajan said in a statement.

The increased Basic Customs Duty would reduce the imports, he said adding that there was a need to increase the import duty on cotton fabric also on par with polyester fabric in the interest of power loom and hand loom sectors to sustain their competitiveness.

Consequent to the scrapping of four per cent additional duty and levy of five per cent of GST on Polyester Fabric, the imported Polyester Fabric attracted 10 per cent Basic Customs Duty and five per cent IGST.

Therefore, there was a significant drop in the import duty threatening the survival of the domestic manufacturing industry due to cheaper imports especially from countries like China.

Therefore, the industry had represented to the Centre and the GST Council to increase the Basic Customs Duty on fabrics to retain the
competitiveness of the domestic manufacturing industry, Natarajan said.