August 28, 2020
Coimbatore : Major textile bodies in the region today appealed to the Centre to remove anti-dumping duty on Viscose Staple fibre (VSF) to
create a level playing for the entire textile value chain.
The removal of the duty will help a big section of MSMEs in their growth and the appeal was perfectly aligned with Aatma Nirbhar Bharat Mission, Indian Texpreneurs Federation (ITF) said in its representation to the Union Textile, Commerce and Finance Ministries.
Textile and Apparel constitute not only a complex value chain but have two other serious considerations one is the participation of MSME sector and another its capability of providing large scale employment, ITF said.
The Government is taking a series of steps to bring structural changes in the champion sector like textiles to build competitiveness in
manufacturing sectors so as to compete in the international markets and the Post-Covid environment in the world’s largest consuming markets like USA is favouring India as one of the preferred alternate destinations in Textile & Apparel sourcing, it said.
Stating that many countries like Vietnam also are looking to source more fabrics from India, he said that the biggest volume of business is emerging from Man Made Fibre( (MMF) & Blended Fabrics and Apparels and Indian companies need to focus on these products to grow our exports.
Presently, out of two of the major raw materials in MMF space -Polyester fibre
is available in India at international prices due to structural changes brought out
in previous budget with the removal of anti-dumping duty on PTA (purified Terephthalic Acid) and the whole value chain is now improving on the Exports’ front.
At the same time, due to anti-dumping duty protection at fibre stage, viscose fibre prices in India are much higher than international prices with a difference of around Rs. 20 to Rs. 23 per kg and this undue protection at basic raw material stage by way of anti dumping duty affects the entire value chain of textiles, he said.
With only one manufacturer for this fibre in India, it’s like monopolising the trade
and with higher cost of raw materials, entire value chain is struggling to compete in the global markets, ITF said.
Moreover, Indian spinners are also facing huge injury due to multi-fold jump in cheap Chinese yarn imports and the import of VSF spun yarn was 2022 tonnes during the year 2016-17 and got increased to 56,262 tonnes during the year 2019-20.
China has been dumping their yarn here and its landing costn is cheaper by Rs. 20 per kg; than the Indian Spinners’ manufacturing cost.
If anti-dumping duty on VSF is removed, Indian spinners will have access to fibre at international prices which will be competitive for the Indian Spinners to match yarn imports. The benefits would then flow to the entire value chain including MSME weaving sector, it said.
In a release, Southern India Mills Association Chairman, Ashwin Chandran also sought the removal of the duty and said that Indian MMF products account for 20 percent of the total Textile and Clothing (T and C) exports, whereas, in China and other textile exporting countries it is 80 per cent.
India is not able to make any progress in MMF T&C exports due to the raw material price disadvantage despite being the second largest producer of MMF in the world.
VSF is still given undue protection by way of anti-dumping duty that seriously affects the entire viscose staple fibre textile value chain, he alleged.
Removing the duty on VSF will make the domestic VSF prices aligned with Global VSF prices making the entire Indian VSF textile value chain globally competitive and boost production and exports of these products, Aswhin said.