The Northern India Textile Mills’ Association (NITMA) is urging the government to implement a Minimum Import Price (MIP) across all of Chapter 60 to effectively curb unchecked fabric imports. This call comes as domestic manufacturers struggle to compete against a rise in cheaper imports, often facilitated by fraudulent practices. NITMA has appealed to Prime Minister Narender Modi for intervention, citing significant financial losses to both the industry and the government.
NITMA is specifically targeting under-invoicing of synthetic knitted fabrics under Chapter 60 and the misdeclaration of HS codes at Indian ports. Despite existing MIPs on 13 HSN codes, imports continue to rise under non-MIP codes, rendering the current measures ineffective.
A recent crackdown by the Directorate of Revenue Intelligence (DRI) led to the seizing of 100 containers of Chinese fabric at Mundra Port, valued at an estimated Rs 200 crore. Falsely declared as low-cost fabric, the shipment actually contained high-quality textiles, indicating an attempt to evade import duties. The declared value of the shipment was Rs 25 crore, suggesting significant under-invoicing. Similar seizures have occurred at other major ports, including Nhava Sheva Port, raising concerns about widespread fraud.
The DRI has launched a nationwide investigation to identify those responsible for the illegal imports, trace the goods, and expose the network of importers involved. The Federation of Surat Textile Traders Association (FOSTTA) had previously warned the DRI about systematic misdeclaration in textile imports, alleging that thousands of containers are imported monthly under incorrect classifications to circumvent the MIP. FOSTTA estimates that this practice has resulted in a revenue loss of Rs 85,000 crore.
Importers are reportedly exploiting loopholes by shifting imports from Chapter 60 to Chapter 59, which currently lacks MIP safeguards. FOSTTA identified Mundra Port, Mundra SEZ, and Nandiambakkam SEZ as key entry points for these illicit imports, also naming suspected importers.
Sidharth Khanna, President, NITMA, points out, some importers are declaring fabric at approximately $1 per kg, while the actual global price is $4–6 per kg, further demonstrating the scale of under-invoicing. He emphasizes on the urgent need for stricter regulations to protect the Indian textile industry. The government now faces increasing pressure to address these loopholes and implement effective measures to safeguard domestic manufacturers from unfair trade practices.
