Cheap imported fabrics take sheen off MMF sector

SURAT:

Cheap imported fabrics of Malaysia

,

Bangladesh

,

Indonesia and Vietnam

, which enjoy 0% duty under Most Favoured Nation (MFN) status of Government of India, have started to hurt country’s largest man-made fabric (MMF) sector in Surat.


Federation of Indian Art Silk Weaving Industry (FIASWI) says import of cheap

fabrics

has taken sheen off the MMF sector in the last couple of years. The powerloom weaving sector is unable to stand competition. The FIASWI has demanded that the government impose safeguard duty of 20% to realize the ‘Make in India’ dream. Condition of silk fabric manufacturers in Varanasi, Bhagalpur, Bengaluru, Tamil Nadu and Surat has worsened in the last two years due to significant increase in import of cheap silk fabrics from Vietnam.

FIASWI chairman Bharat Gandhi said import of fabrics has increased two-fold from two lakh square metres in 2015-16 to five lakh square metres in 2016-17. “Many Chinese manufacturers have set up factories in Vietnam. They manufacture silk fabrics in Vietnam and dump them in India. This has adversely affected Indian silk weaving and silk exports and also dented employment situation,” he told TOI.

Gandhi said, “Apart from fabrics import, manufacturers of fabrics are comfortable with GST rates of 5% and 12% on MMF yarn and that any increase by the government in GST rates will lead to inflation of fabric prices and the whole value chain will be disrupted. Reduction in GST rates will benefit manufacturers of yarn and also spinners as they will be able to increase the basic price of yarn.”

He said government circular of March 28, 2019 which stated interest is to be paid on credit lapsed for organizations, who have not lapped their credit on July 31, 2018, should be revoked.


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