India’s Ministry of Textiles is considering a range of duty reductions and regulatory relaxations to stabilise raw material supplies as the textile sector faces growing pressure from disruptions linked to the West Asia crisis.
The proposed measures include lowering import duties on rayon pulp and select cotton varieties, along with deferring anti-dumping duties on certain yarns. Officials confirmed that discussions are ongoing with the Ministries of Agriculture and Finance to finalise the proposals. While some industry stakeholders are pushing for a complete removal of duties due to limited domestic availability, the government is also weighing the potential impact on farmers.
In addition, the ministry has recommended removing the minimum import price (MIP) on specific knitted fabrics. The move comes as rising input costs and shipping challenges continue to affect production and weaken India’s competitiveness in global textile markets.
To counter declining exports, the government is encouraging manufacturers to explore opportunities in East Asian markets. Readymade garment exports fell by 19% year-on-year in March, largely due to instability in West Asia.
India’s cotton imports remain limited, mainly focused on specialised varieties such as extra-long staple cotton sourced from the United States and Egypt. Rayon pulp, which attracts a 5% import duty, is largely imported from Europe.
Previously, the government had temporarily waived the standard 11% duty on cotton imports for four months ending December 31, aiming to offset the impact of high tariffs imposed by the United States.
In a related development earlier this month, full customs duty exemptions were granted on 40 petrochemical products, including 29 widely used in the production of man-made fibres.
The textiles ministry has also approached the finance ministry to defer or remove proposed anti-dumping duties on elastomeric fibre yarn and viscose rayon filament yarn, which are primarily imported from China and Singapore.