Indian textile industry seeks PSF–PSY tariff parity under ASEAN FTA

In a representation to India’s Minister for Commerce and Industry Piyush Goyal, the Northern India Textile Mills’ Association (NITMA) highlighted that PSF (HS 55032000) continues to attract a 5.5 per cent basic customs duty, while finished PSY (HS 55092100) is imported duty-free under the FTA, creating an inverted duty structure that disadvantages domestic spinners.

The association acknowledged the government’s recent decision to rescind multiple Quality Control Orders across the man-made fibre value chain, noting that the move has improved raw material availability and eased compliance burdens for MSMEs. However, it warned that the duty disparity continues to erode competitiveness.

According to official data cited by NITMA, PSY imports surged from 8.4 million kg in 2010–11 to 82 million kg in 2022–23 following the implementation of the FTA. Although the Directorate General of Trade Remedies recommended anti-dumping duties in August 2021, the proposal was not approved, leaving domestic producers exposed to rising imports.

India currently has over 150 operational PSY manufacturers, with around 500 additional units capable of shifting to PSY production if market conditions improve. The association said correcting the tariff anomaly could revive idle capacity and generate employment across the textile value chain.

NITMA has requested that PSF and PSY be treated together in the revised AITIGA framework, either by including or excluding both products, to ensure policy consistency. The industry believes this move would support India’s goal of achieving $350 billion in textile output, including $100 billion in exports, by 2030.

ALCHEMPro News Desk (KUL)