India has initiated anti-dumping investigations against the import of silk fabrics from China. |
The directorate-general of anti-dumping and allied duties (DGAD) observed that there was "prima facie" evidence to show causal link between the dumped imports of Chinese silk fabrics of 20-100 gm per metre weight and injury caused to the domestic industry. |
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The authority pointed out that various parameters, such as significant decline in production, decline in capacity utilisation, closure of several power looms, decline in sales, drop in employment, loss of market share in demand, decline in profitability and losses to domestic industry, prima facie indicated that it had suffered material injury on account of dumping. |
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It noted that share of imports from China had increased in absolute terms as well as in relation to the demand of the product in India. Silk fabric is also produced on handlooms in India, but for the purpose of this investigation only the silk produced on powerlooms is being considered. |
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The period of investigation of the enquiry is April 1, 2003 to September 30, 2004. |
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The application alleging dumping of Chinese silk was filed by the Central Silk Board along with Mysore Power Loom Silk Manufacturers Cooperative Society, Karnataka Weavers Federation, Silk Trade Association, Varanasi and Pure Silk Weavers Association, Surat. |
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Earlier, talking to Business Standard, Union textiles minister Shankarsinh Vaghela had said his ministry "will ensure that our domestic markets are not affected by cheap imports from China. The rise in imports are a matter of concern. Anti-dumping measurers would be initiated against China if the imports are found beyond WTO limits". |
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Imports of synthetic filament yarn from the Middle Kingdom has already surpassed 16.90 million metres "" worth $13.3 million "" in the last two months. |
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If the trend continued, it would result in an import of $80 million worth of synthetic filament yarn from China annually. And the almost negligible increase in filament fabric production in India only complicates matters further. |
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According to the textile ministry, fabric production in India has increased by 4.64 per cent in 2004-05. While the production of cotton fabric surged by 8.3 per cent, that of filament fabric increased only by 0.08 per cent. Production of blended cloth increased 4.4 per cent in the year 2004-05. |
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Arun Jariwala, president, The Surat Art Silk Cloth Manufacturers Association, said there is an urgent need for the government to reverse the trend in imports. |
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"There has been a sea-change in the situation this year. Earlier, the growth rate of filament fabric output was 10-12 per cent, but now it has plateaued. On the other hand, the growth rate of cotton fabric production, which was 3 to 4 per cent earlier, has almost doubled this year. The growth rate of cotton fabric globally is 2-3 per cent, and that of synthetic fabric is 8 to 10 per cent. China has maintained a strong growth rate of 15 to 20 per cent in synthetic textiles over the last fifteen years, but the situation in India is just the opposite," said Jariwala. |
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While the Central government abolished the duty on cotton yarn in the previous year's Budget, it, however, imposed 12 per cent and 24 per cent duty on synthetic fibre and polyester filament yarn, respectively. |
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The zero per cent duty on cotton yarn has been continued in this year's Budget even as 16 per cent duty was imposed on polyester filament and fibre. |
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A Surat-based synthetic fibre manufacturer said the textile industry in the city, which is mainly synthetic-based, is facing grave problems since the last two years. "So it is not in a position to avail of the benefits of the free trade regime," he said. |
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According to Jariwala, the synthetic textile industry is being adversely hit as the basic principle of same duty to be levied on all type of textiles is not being followed in India. |
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"To make sure that the synthetic textile industry is able to reverse its fortunes, the Central government should initiate immediate steps for rationalising the duty structure in textiles," said Jariwala. A tangled skein - The directorate-general of anti-dumping and allied duties observed that there was "prima facie" evidence to show causal link between the dumped imports of Chinese silk fabrics of 20-100 gm per metre weight and injury caused to the domestic industry
- The authority pointed out that various parameters, such as significant decline in production, decline in capacity utilisation, closure of several power looms, decline in sales, drop in employment, loss of market share in demand, decline in profitability and losses to domestic industry, prima facie indicated that it had suffered material injury on account of dumping
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