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Import duty on some textile products to be increased to boost domestic industry

The government is likely to hike import duty on about 300 textile products to boost domestic manufacturing and create employment opportunities. Additionally, it may also relax FDI norms for the sector. The products on which import duties are expected to increase include a few fabrics, garments and man-made fibres. The duties could be enhanced to 20 per cent from the current level of about 5-10 per cent. This increase in duties is likely to provide an edge to domestic manufacturers as the imported products are relatively cheaper. Increase in manufacturing will create jobs in the sector, which employs about 10.5 crore people.

In July, the Central Board of Indirect Taxes and Custom (CBIC) doubled import duty on over 50 textile products to 20 per cent, a move that is aimed at promoting domestic manufacturing. The imported products that have become expensive included woven fabrics, dresses, trousers, suits and baby garments.