The Government of India has doubled the import duty on more than 300 textile products for the second time this month, which is not good especially for garment export industry, said Animesh Saxena, Managing Director, Neetee Clothing, Gurgaon cum Executive Member of Apparel Exporters and Manufacturers Association. “Our export growth is stagnant because our fabric basket is mainly restricted to cotton fabrics,” he says.
Calling it an unhealthy move taken by the government, Saxena said, “Indian polyester fabrics are of not good quality and are expensive too. By taking this step, government is trying to protect Indian polyester fabric makers but also restricting the growth of apparel export in this category.” The government expects that the higher duty will help India’s domestic industry, which employs nearly 10.5 cr people and has been facing stiff competition from cheaper imports.
India doubled the import tax from the existing rate of 10 per cent to 20 per cent to boost the ailing textile sector, promote local manufacturing and create employment opportunities. The move came after the recommendation from the Textile Ministry, which had said that local manufacturing is suffering due to cheaper imports from China and other neighbouring countries.
This is for the second time government increased the import duty. Last month, the government had doubled import duty on over 50 textile products including jackets, suits and carpets to 20 per cent.
However, the 20 per cent duty will not be applicable to products sourced from Bangladesh, Vietnam and Cambodia countries due to the FTA.