Southern Gujarat Chamber of Commerce and Industry (SGCCI) and Pandesara Weavers' Coooperative Society Limited has raised concerns that import of heavily under-invoiced fabrics from China has crossed Rs 5,500 crore in the last one year, but could be worth Rs 10,000 crore.
To protect the small and medium enterprises in Surat from these cheap Chinese fabrics and hence they have jointly submitted a representation to the ministry of commerce and the Confederation of Indian Industries (CII) demanding imposition of import duty on Chinese fabrics.
SGCCI president P M Shah said that the Government of China provides heavy subsidy to its textiles industry. They have provided a detailed list of the benefits enjoyed by the textile entrepreneurs in China. This further reduces the production cost per unit in China. Thus, it has become difficult for the powerloom weavers to survive here.
Pandesara Weavers' Coooperative Society Limited president Ashish Gujarati said that the quality of fabrics imported from China are made of man-made and synthetic fibres as cotton is expensive in China compared to India. This fabric has caused a surge in demand to India's SMEs in Surat.
Gujarati stated that India despite having production capacity has lost out on production leading to massive unemployment. Imports of fabrics are taking place at unit price of Rs 5 to Rs 15 per square metre. This price is unbelievably low for any kind of fabric as a simple handkerchief costs more than Rs 5 per piece in the market. Therefore, the cost of fabrics should be at least Rs 50 per metre. There should be immediate steps undertaken to stop clearance of undervalued fabrics.
Gujarati added that there are some tariff lines in a fabric which does not have specific duty and import of fabrics should be allowed only under automatic advancement scheme for actual users.
Immediate steps needs to be taken to stop imports of fabrics by increasing import duty and further imposing specific duty on all kinds of man-made fibre-based fabrics.
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