T.N. textile industry seeks withdrawal of QCO on viscose fibre and yarn
The industry said viscose-based fibres are one of the most significant input materials in the textile sector, next only to cotton. Over 70% of viscose yarn produced by more than 80 spinning mills in India are woven on powerlooms in Tamil Nadu.
Since March 2023, imposition of QCO on imported VSF has restricted access to competitively-priced imported VSF from Indonesia, Thailand, and China due to delays in BIS licensing. Hence, Indian spinners are compelled to procure from a single domestic monopoly supplier, leading to increased input costs and limited supply terms. Imported VSF under FTA is cheaper by ₹25 a kg compared to domestic VSF, but the QCO nullifies this cost advantage.
This has severely hurt the cost structure of spinners and weavers, leading to a slowdown in production, closure of units, and sale of machinery as scrap.
A notification dated September 26, 2024 proposing to bring VSY under QCO is a further blow to the struggling sector. Imposing QCOs on VSY, especially amid existing raw material challenges, will result in supply disruptions, higher costs, and further job losses, the industry said.
The government should ensure raw material availability to boost textile exports, create jobs, and revive MSMEs in the textile sector.
'The weaving sector, especially in Tamil Nadu, is at a breaking point. We urge your ministry to act with urgency and empathy to protect millions of livelihoods dependent on this value chain,' the industry said.
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