FIASWI urges for hike in import duty on Chinese fabric

The Federation of Indian Art Silk Weaving Industry expressing concerns over the dwindling in demand of man-made fabric (MMF) manufactured in Surat, Maharashtra and other parts of the country due to the huge increase in import of MMF fabric in 2013-14 from China, Taiwan and South Korea.

FIASWI has urged for hike in import duty on fabric from 10% to 30% to discourage Chinese manufacturers.

During 2013-14, import of fabric from China increased 79.49% in terms of quantity followed by 4.15% and 0.89% from Taiwan and Korea respectively. The total import of fabric from these countries accounted for 84.56%.

China is able to dump huge quantity of fabric due to subsidy of 29% given for exports of this item by the Chinese government.

The situation in the power loom sector across India is very depressing due to low availability of man-made filament yarn and huge imports of the fabric. The fabric imported from China, Taiwan and Korea attracts around 10% customs duty against 12% excise duty on man-made fabric manufactured and sold in India.

The domestic man-made fabric sector is facing stiff competition from the cotton fabric. The man-made fabric attracts 12% duty, while there is zero duty on cotton fabric despite use of cotton fabric decreasing in the international market.

Surat is the country’s biggest manufacturer of man-made fabric with annual production pegged at 1,000 million metre. The powerloom sector has an installed capacity of around 6 lakh machines, employing over 5 lakh workers.