MUMBAI: On the heels of top guns of India Inc demanding protection for the textile industry from cheap Chinese imports, textile manufacturers and associations have warned that the domestic industry would be extinct if dumping is countered.
The industry claims that as much as 60 per cent of dumping happens from China, and unofficial estimate peg the size of this trade varying between 20 and 40 per cent of the USD 105-billion domestic textile industry.
"If the present level of dumping continues unchecked, the domestic textile industry will be extinct over the next few years. China, facing over capacity, has for long been dumping their fabrics and ready-made garments to our market through Bangladesh, Nepal, Vietnam and even Cambodia," Chairman for Policy, Apparel Export Promotion Council Premal Udani told PTI.
Udani's firm Kaytee Corporation is one of the largest garment exporters to American retail chains.
Pointing out that the domestic industry is facing the problem of Chinese or Chinese-origin apparel and fabric dumping from long, Udani said what the government should do is to ensure that our borders are better policed, and the customs officials do vigorous inspection of the country-of-origin of goods being shipped in and incentivise the domestic industry apart from engaging in better terms of trade with our neighbours.
He further said when China finds that shipments through one channel has reached the official limits, it starts exporting the same goods to other countries like Hong Kong, Vietnam, Bangladesh and Cambodia for onward shipping to India to avoid customs inspections.
The impact of increasing dumping by Chinese is also felt by the largest textile manufacturers like Birla Cellulose, Century, and other textile mills among others.
"Cheap dumping by Chinese and Indonesian manufacturers has been hurting us really badly. It's not that our domestic market is not growing. Unless we do something about the problem of dumping, the very plan of pushing local manufacturing will come a cropper," CMO, Birla Cellulose Rajeev Gopal, which is the largest viscose staple fibre (VSF) producer in the world, said.
The VSF industry claims that dumping of cheap products across the value chain from fibres to yarns to fabrics is hurting the domestic industry. Nearly 8-10 per cent of the domestic consumption of 25,000 tonne per month has been affected by such imports.