In a Press Release, Ravi Sam, Chairman, SIMA, has appealed to the Union Minister of Finance to exempt the cotton from 11% import duty during off-season (i.e) April to October as was done last year to ensure raw material security, avoid mass production stoppage and depletion in exports. He has said that cotton textiles exports have dropped over 23% when compared to the previous year, thus, requiring cotton to be made available to the manufacturing sector at an internationally competitive price. He has said that duty exemption is essential to revive the export performance.
Ravi Sam has stated that the industry normally needs 320 to 330 lakh bales of cotton as against the crop size of 310 to 320 lakh bales. 30 to 40 lakh bales is normally exported and therefore the industry would face acute shortage if the import duty exemption on cotton is not announced immediately.
SIMA Chairman has stated that though India-Australia ECTA allows duty-free import of three lakh bales of cotton annually, the exporters from Australia demand three to five cents per pound premium due to the import duty levied by the Union Government thus squeezing the benefit of FTA and affecting the global competition.
SIMA Chief has stated that India’s cotton yarn exports decreased to 48.5 crore kgs during April 2022 to January 2023 as against 118.5 crore kgs exported during the same period in the previous year. He has appealed to the Minister of Finance to exempt the cotton from 11% import duty for the off season (April to October) and exempt the ELS cotton from import duty as the country produces only around 20 to 25% that too of inferior quality.
He has said that the Union Budget 2023-24 has brought separate HSN Code for ELS cotton and therefore, the Government can exempt the ELS cotton from import duty on long term basis till the current Government Policies to increase the production of ELS cotton yields results while exempting the normal cotton only during the off season.