The textile industry is urgently appealing to the government to reconsider imposing an anti-dumping duty on Mono Ethylene Glycol (MEG). This crucial chemical is a primary raw material for producing polyester fibers and filaments, forming the backbone of much of India’s textile output.
According to R.K. Vij, secretary general of the Polyester Textile Apparel Industry Association, the textile sector relies heavily on Purified Terephthalic Acid (PTA) and MEG, which together constitute 70-75% of the raw materials needed for polyester fiber production.
Annually, India requires approximately 2.8 million tonnes of MEG. A significant portion, nearly 1.2 million tonnes, is imported from countries like Singapore, Qatar, and Saudi Arabia. Due to Quality Control Order restrictions, importing MEG from China is not feasible for the industry.
Vij warned that the proposed anti-dumping duty (ADD) could escalate the cost of MEG, a vital component for man-made fibers, yarns, filaments, fabrics, and garments, by as much as 20%.
With India currently importing 40% of its total MEG consumption and no immediate plans for increased domestic production in the next 3-4 years, the industry argues against the ADD. They point to the government’s 2020 decision to remove ADD on PTA, which aimed to ensure global pricing for MMF raw materials, as a precedent.
He further highlighted that the government recently lowered GST on man-made fiber (MMF) yarn and fabrics to boost the MMF textile sector. Imposing an anti-dumping duty on MEG would counteract this initiative, making synthetic products costlier and hindering the sector’s growth.
Echoing these concerns, Ashwin Chandran, chairman of the Confederation of Indian Textile Industry, and Durai Palanisamy, chairman of the Southern India Mills Association, emphasized that readily available raw materials like PTA and MEG at competitive international prices are essential for the textile industry’s health.
The industry remains optimistic, with Mr. Vij stating that meetings with the Ministries of Textiles, Finance, and Chemicals are anticipated soon to address these critical issues.