Industry body FICCI has welcomed the recent multi-faceted measures taken by the government to address the problems of the textile industry.

Reacting to recent positive measures to promote the textile industry, FICCI said that increase in import duty on 76 textile items from 10% to 20% and GST reduction on carpets and handicraft items have given a big relief to domestic textile, carpet and handicraft manufacturers, said Mr. Shishir Jaipuria, Chairman, FICCI Textile Committee.

FICCI Textile Committee chairman Shishir Jaipuria said, "It is heartening to see the multifaceted steps taken by the Government in last few days for addressing problems of various segments of textiles and handicraft industry. We thank Prime Minister Narendra Modi, Finance Minister Mr. Piyush Goel and Textiles Minister Smriti Irani for the much-needed timely support for the industry."

Jaipuria stated that garment & carpet industry was under immense pressure after implementation of GST. After GST, substantial drop in import duty was observed which has encouraged cheaper imports. It is also worth noting that total imports of textiles and garments increased in 2017-18 (USD 7 billion) by 16% in comparison to 2016-17 (USD 6 billion). Total import of garment alone increased by 30% in 2017-18 in comparison to 2016-17.

Jaipuria further said that imports from Bangladesh is an area of concern for the industry. Due to full exemption of basic custom duty from Bangladesh and also due to lack of regional cumulation clause under the treaty, third countries' raw material and fabrics are getting benefitted indirectly. Imports from Bangladesh has increased by 44% in 2017-18 in comparison to 2016-17.

It is suggested that Government may consider imposition of regional cumulation clause in Rules of Origin on the countries that have FTAs with India to safeguard garment industry further as cheaper fabric of third countries enter India through these countries. 

The FICCI official also felt the need to increase the import duty on MMF spun yarn as import of MMF yarn-based fabric also increased sharply after GST implementation. FICCI is hopeful that Government will take further steps to address unresolved issue.