Textile industry faces acute shortage of VSF and ELS cotton

The Indian textiles & clothing industry has established its dominant value added product market share both in domestic and international markets during the last several years especially in the recent past, more so in the superfine VSF and its blended textiles and clothing products.  The industry has been pleading the Government to remove anti-dumping duty of $0.103 to 0. 512 per kg imposed on the VSF during the last several years, which is under active consideration.  The Government is mulling the removal at the time of sunset review which is due in August 2021.  In the meanwhile, the Union Budget 2021-22 imposed 5 percent basic customs duty and 5 percent AIDC on cotton (effective rate 11 percent including 10 percent social welfare surcharge).  This has greatly impacted the supply chain of both domestic and international markets and also spiraled domestic Indian ELS, organic and contamination free cotton prices that are already under acute shortage.

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