IMPRESSIONS from a Cross-section

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Anti-dumping duty was removed on VSF. Is this going to boost the MMF sector?

Indian MMF sector to become globally competitive

The government has decided to remove the anti-dumping duty (ADD) on viscose staple fibre (VSF) originating in or exported from China and Indonesia, to make its prices competitive with the global prices. Fibre2Fashion asked cross-section of the textile industry how the removal of ADD is going to benefit the Man-made fibre (MMF) segment.

Ashwin Chandran
Chairman, SIMA

Unlike other manmade fibres, the viscose staple fibre produced by a single indigenous manufacturer was very expensive to the tune of ₹20 per kg, though recently the domestic manufacturers have reduced the price to match with the international price to a certain extent. The export price concept extended by the indigenous manufacturers greatly affected the powerloom and downstream sectors, as the industry is predominantly MSME and fragmented. The anti-dumping duty on VSF ranged between US $0.103 per kg and US $0.512 per kg.

The industry started facing shortage of viscose fibres as the supply was restricted to only around 200 spinning mills while the polyester fibre was made available freely across the segments. The viscose staple fibre was not made available for the MSME segment that greatly affected the powerloom and the MSME garment sectors. So, the removal of anti-dumping duty on VSF would greatly benefit the MSME segments.

The government has recently announced the Production Linked Incentive Scheme earmarking ₹10,683 crores to attract large scale investments in the MMF value chain by identifying 42 HS Codes MMF apparels, 10 MMF Technical Textiles products and 14 MMF fabrics. A majority of these products comprise of viscose and its blended textiles, the anti-dumping duty removal would facilitate to achieve the vision of creating 40 to 50 world champions in the MMF products.

The VSF spinning segment has been facing severe challenge due to duty free import of VSF spun yarn from the ASEAN countries though it benefited the powerloom and the downstream sectors. Over two lakh powerlooms in Tamil Nadu have migrated to VSF fabric production in the recent years and the duty removal would encourage the powerlooms in Tamil Nadu and other parts of the country to achieve an exponential growth rate.

T Rajkumar
Chairman, CITI

This will make available VSF raw materials at internationally competitive prices in India and facilitate the Indian MMF sector to become globally competitive. This will also promote ease of doing business in India and generate investment and employment in the VSF and MMF textile value chain.

The VSF value chain was facing a shortage of viscose fibres as the supply was restricted to only around 200 spinning mills while the polyester fibre was made available freely across the segments. The viscose staple fibre was not made available for the MSME segment and thus greatly affected the power loom and the MSME garment sectors. The government’s decision would benefit the MSME segments to a great extent.

The government has already announced game-changing schemes like Mega Investment Textiles Parks (MITRA) and Production Linked Incentive (PLI) Scheme for the textile sector. Under PLI, the government has identified 42 HS Codes MMF apparels, 14 MMF fabrics and 10 MMF Technical Textiles products. A majority of these products comprise viscose and its blended textiles, the anti-dumping duty removal would facilitate achieving the vision of creating 40 to 50 world champions in the MMF products.

Further, the decision of withdrawal of anti-dumping duty on VSF is in line with its long-term policy for the Indian textile and clothing industry to achieve the ambitious target of US $350 bn by 2024-25.

Sanjay Garg
President , NITMA

The down-stream domestic industry, such as weaving & garmenting, will be substantially benefitted due to accessibility of fibre at competitive prices, empowering them to produce and export the viscose-based products at globally competitive prices.

Rahul Mehta
president and trustee, CMAI

The government has taken the right decision to promote the MMF segment under its PLI Scheme. We have been in favour of no import duties and anti-dumping duties on raw materials, as they make our garments' production more expensive

Raja M Shanmugham
President, Tiruppur Exporters’ Association (TEA)

This is a much-expected step by our government, which should help us achieve price equality in the international markets. Until quite recently, only a few monopolies were playing a dominant role in India owing to the price disparity. But the removal of ADD will help the trade to grow in the export as well as domestic segments.

A Sakthivel
Chairman, Apparel Export Promotion Council (AEPC)

The removal of protectionist tariffs on VSF will align domestic VSF prices with global prices, making the entire Indian VSF textile value chain globally competitive. It will boost production and exports.

The (recent) decision will help the MMF segment, which both the industry and government have identified as the sunrise sector, for increasing the share of India in global apparel trade. With quality fabric at the right price in place, it will finally give wings to the proposed Production Linked Incentive (PLI) scheme for the MMF segment.

Published on: 17/08/2021

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.

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