Cotton industry welcomes removal of 11% import duty

The central government’s decision to remove the 11% import duty on cotton has been welcomed by small spinners and the industry as a whole. On April 14, the South India Small Spinners Association (SISPA) said the removal of import duties would help spinners affected by the frequent rise in cotton prices to buy cotton at cheaper prices and would also help more arrivals, SISPA President J. Selvan said in a statement. .

He thanked Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman and Textile Minister Piyush Goyal for waiving import duties until September 30.

He also thanked the Chief Minister of Tamil Nadu, MK Stalin, for writing to the Center about the plight of the textile industry. Kongunadu Makkal General Secretary Desiya Katchi, ER Eswaran, said the removal of import duties would help reduce the price of cotton, yarn and fabric raw materials to some extent.

It would also help exporters compete with countries like China, Vietnam and Bangladesh, he said in a separate statement. The Confederation of Indian Textile Industry (CITI) and the Southern India Mills’ Association (SIMA), in a joint statement, said the central government’s decision to scrap the 11% import duty would protect farmers’ interests and industry.

CITI Chairman T. Rajkumar and SIMA counterpart Ravi Sam said farmers have been able to earn a record income by taking advantage of the sharp increase in international and domestic cotton prices in the current season.

As farmers sold their cotton and started preparing for sowing for the next season, the removal of import duties until September 30 would not hurt them and some traders and ginners hoarded cotton and speculated on prices .

This would be discouraged from April 14 as the industry can start importing the cotton even from nearby transshipment ports like Tuticorin, Colombo, Dubai and Malaysia, according to the joint statement.

The international cotton season would start in August and the industry here would be able to maintain its performance thanks to the proactive initiative taken by the government, according to the statement. In the short term, there might be some increase in the international price, but the domestic cotton price would soon decrease and match the international price in addition to creating a level playing field, he said.

Due to the import duty, the industry had expected a production stoppage of 15-30% as domestic cotton prices were unsustainable and MSME mills could not buy cotton on the open market, even at a higher price, he said. . The central government averted a crisis for the industry by taking the decision to remove import duties, the statement added.


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