Textile industry growth hindered due to costlier MMF: SIMA

Country's textile sector could not achieve the envisaged growth rate primarily due to saturated growth in the man-made fibre (MMF) textiles and clothing segment caused by higher duty structure, industry body SIMA said today.
The MMF textiles and clothing exports accounted for 80 per cent and cotton textiles for 20 per cent in China, while in case of India it was totally opposite, Southern India Mills Association (SIMA) said in a statement.
This was because MMF and filaments, the basic raw materials were costlier by 23 to 30 per cent due to 5 per cent import duty, four per cent special additional duty, 12.5 per cent central excise duty and anti-dumping duty on certain fibres and filaments, SIMA Chairman Senthil Kumar said.

Stating that indigenous fibre manufacturers were adopting import parity pricing policy taking advantage of the tariff protection, he said adding that white cotton was available at international price.
On the forth-coming Budget, Kumar said he is hopeful that the Centre would consider the long pending agenda of removing the 5 per cent import duty, four per cent special additional duty and anti-dumping duty and further reduce the central excise duty from 12.5 per cent to six per cent levied on MMF.
The domestic textiles and clothing industry provides jobs to over 105 million people particularly in rural areas and women folks, he said.

It (Indian textile industry) has the potential to become a USD 350 billion industry from the current level of USD 110 billion creating new jobs for about 35 million people by 2023, provided creating a level playing field is mentioned in the Budget, Kumar said.
SIMA further requested the government to continue the optional Cenvat route for cotton textiles which was introduced in 2004 owing to a break in the excise net across the textile value chain.
It was essential to continue the optional Cenvat and thus prevent hardship for the ailing spinning sector due to steep fall in yarn exports, he added.