Cut in import duty on blankets to affect domestic manufacturing units

The Central government’s decision to cut the levy of import duty and GST from 29 percent to 16 percent on all imported blankets and fabrics will leave over four crore workers engaged in the country’s textile and mink blanket manufacturing units with a dreary future. These units produce nearly 1.5 lakh mink blankets every day, out of which 15 percent are exported to North America, Europe, Russia and Australia.

The GST Council’s decision to decrease the customs duty and other taxes under the GST regime is set to result in shutting down of over 50 large scale mink blanket manufacturing units in the country, as these units will find it difficult to compete with cheap imported mink blankets after the GST rollout.

Abhishek Vij, Director of Jalandhar-based Shital Fibres Ltd., a mink blanket manufacturing unit that contributes around 70 percent in India’s mink blanket exports. The company produces nearly 45,000 blankets daily said that they will be left with only two options. Either, they will be forced to shut down their units or they will have to import blankets from China and stop domestic production. This will lead to unemployment of thousands of workers currently engaged in the mink blanket manufacturing industry.

They cannot compete with mink blankets imported from China as these would be cheaper by at least 13 percent due to decreased duties on imported blankets from July 1.

Ramesh Jagota, president, All India Mink Blanket Manufacturers’ Association said that the textile industry employs nearly six crore workers. Under the GST regime, not only mink blanket industry will suffer huge losses but the textile, yarn and fibre industries, too, will also incur losses.

Cutting down of import duty, cess and GST on imported blankets from 29 percent to 16 percent will be disastrous for domestic textile and blanket manufacturing units. They will raise the issue with Union Finance Minister Arun Jaitley soon and request him to review the decision.

Under this situation, Prime Minister Narendra Modi’s ‘Make in India’ slogan seems to have evaporated into thin air.