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  • Breather for the textile industry with the removal of import duties on cotton | Ahmedabad News

Breather for the textile industry with the removal of import duties on cotton | Ahmedabad News

By on April 15, 2022 0
Ahmedabad: After the government scrapped the basic cotton tariff on Wednesday, textile industry players breathed a sigh of relief. It also offers respite to cotton traders as well as manufacturers of available cotton yarn, fabric and garments.
Prices of the commonly used cotton variety – Shankar-6 – more than doubled to Rs 93,000 per candy (356 kg), as a result of which local cotton prices exceeded international prices.
“The removal of duties was essential; however, it should have been taxed two months ago. Much damage has been done to value-added industries in the textile value chain. Prices may not come down soon because of this, but the least they can do is ensure the availability of cotton,” said Sanjay Jain, chairman of ICC’s textiles committee.
Industry players, however, believe the government needs to take stronger short-term measures, such as mandating stock disclosure and tightening MCX trading standards.
Rahul Mehta, Chief Mentor of the Garment Manufacturers Association of India (CMAI), said, “This move will make enough cotton available in the market and to some extent help to rationalize cotton prices in the coming days. come. This will have a positive impact on the textile value chain and if the prices of other raw materials also fall, the future looks bright in terms of export and domestic demand.
“With the cost of cotton dropping from Rs 60,000 to Rs 90,000 per candy in six months, many small players would have had to deal with mills closing. Removing import duties will ease pressure on manufacturers facing shortages. The imposition of import duties had placed Indian textile manufacturers at a disadvantage compared to Pakistan, Bangladesh and Vietnam. Rising production costs have affected the competitive price advantage for Indian manufacturers,” said Ronak Chiripal, CEO of Nandan Terry Limited, echoing a similar view.
However, international cotton prices increased by more than 5%, making imports more expensive.
Rahul Shah, co-chairman of GCCI’s textile committee, said: “We asked for a reduction in duties three months ago. The mills will have the possibility of importing cotton so that the internal prices fall. Many mills have recently placed orders for imported cotton and we believe this move will bring price stability. However, we are witnessing a speculative market. Only time will tell if cotton prices will fall or not.