The Indian Spinners Association (ISA) has alleged that Grasim Industries, the prime manufacturer of VSF in India, is selling the raw material at prices much higher than global rates, hurting the domestic textile industry and hence urged the government to do away with the anti-dumping duty on viscose staple fibre (VSF), imposed in 2010 on shipments from China and Indonesia.
In India, VSF is a major input in the manufacture of fabrics made of poly-viscose and 100 per cent viscose yarn. There are about 150 spinning mills in the country, with about five million spindles.
ISA in separate representations to Textiles Secretary Rashmi Verma and Central Board of Excise and Customs (CBEC) Chairman Najeeb Shah said that they are paying an ex-mill price of $2.15 plus 12.5 percent excise duty against an import price of $1.85 per kg (c.i.f.).
It is unfortunate that Grasim itself is supplying the fibre to their competitors in other countries at an ex-mill price of $1.80 per kg. However, Grasim did not respond to queries sent by this newspaper on the matter.
According to SK Khandelia, President, ISA, there is no justification behind the extension of the anti-dumping duties as the domestic producer of VSF is doing brisk business, and it is the users that are suffering. With textile exporters from India already struggling to maintain their share in the global market, high input costs are pulling them down further.
The Directorate-General of Anti Dumping (DGAD) is at present carrying out a sunset review of duties imposed on VSF in 2010 to examine if there is a case for their extension. The duties cannot be extended beyond July this year in the absence of a recommendation by the DGAD.
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