It is a distinct honor to welcome you to the 70th Annual General Meeting of MATEXIL. While this year has presented its share of challenges, it has also highlighted the resilience and strength of our industry. Together, we will reflect on our achievements and look forward to a future rich with promise and opportunity.
We are proud that India stands tall as an oasis of opportunities amidst global turmoil and disruptions in supply chain. The Government’s continuous efforts towards improving the ease of doing business and commitment to create world class infrastructure through enhanced funds allocations and capital spendings have all contributed towards fuelling an annual GDP growth rate of minimum 7% during the last 3 years and over 8% in the year under review. Government initiatives like Atmanirbhar Bharat pursued through Innovative schemes like the Production Linked Incentive Scheme (PLI Scheme), PM Mitra Scheme, various facilities under NTTM ( National Technical Textiles Mission ) for Technical textiles will certainly provide an impetus to manufacturing and create an Ecosystem for entrepreneurship in the Textiles sector. In addition, all these initiatives have set a strong foundation to propel the realisation of a Viksit Bharat with a USD 35 trillion economy by 2047.
Global Ecosystem
The year 2023-24 has brought about significant shifts in the global economy. Geopolitical tensions, particularly the ongoing conflict between Russia and Ukraine, along with the crisis in the Red Sea, have severely disrupted global supply chains. Elevated inflation in key markets such as the United States and
Europe has affected consumer confidence, leading to a decline in demand for textiles and apparel.
The Israel-Hamas conflict are further influencing the global economy. Energy prices remain highly volatile across Europe and other major economies, impacting both production and consumer prices.
Challenges faced by the exporters
While on the global ecosystems, I would like to briefly touch upon some major challenges faced by the exporters.
Red Sea Crisis
During the year, exporters had to face a huge challenge on account of the Red Sea Crisis. The attack on cargo ships passing through Suez Canal to the European Ports were attacked by militants. As a result, ships had to take a long route via the Black Sea which has led to higher transit period, shortage of containers and a huge increase in the freight rates. Although the situation has eased out a bit, the challenge continues. I would urge the Government to grant some support to the exporters to overcome this difficult situation. I would also urge the Government to put in place a PLI Scheme for manufacturing containers in India, which is currently under consideration, at the earliest. This will reduce our dependence on imported containers over a period of time and make us sef-reliant.
ESG Regulations
Leading Markets for Man-Made Fibre Textiles and Technical Textiles like EU, US, Australia, etc. have all put in place regulations on sustainability, circularity and labour standards. It has become necessary for exporters to understand these regulations and also to adapt their products, manufacturing process etc. in line with these requirements. With regard to labour standards, it has become necessary to ensure compliance in the entire supply chain. Companies, therefore, need to work with suppliers to ensure that Sub-Contractors and Secondary suppliers also adhere to these Labour Standards. In addition, detailed records and proper documentations will be required to be maintained by the exporters for smooth customs clearance and compliance certifications.
The Council will be conducting various awareness and training programs to sensitize it’s members and to prepare themselves to adapt to these ESG Regulations. In this regard, the council is in discussions with International Agencies and experts in ESG Regulations to conduct the training programs.
Name Change of the Council
To reflect the expanded mandate given by the Government to our Council to promote exports of Technical Textiles also in addition to manmade fibres, yarns, fabrics and made ups ( including home textiles ) , Council has changed it’s name from SRTEPC (Synthetic and Rayon Textiles Export Promotion Council) to MATEXIL ( Manmade and Technical Textiles Export Promotion Council). This new name aligns with our broader mission to represent the full range of products under our purview, including fibres, yarns, fabrics, made-ups, and technical textiles to promote exports.
Export Trends
In 2023-24, exports of man-made fibre textiles reached US$ 5742 million as compared to US$ 5903 million in 2022-23 registering a decline by 2.7%. This downturn in exports were primarily driven by inflationary pressures, elevated energy costs in Europe, and shifting trade dynamics. On the other hand , exports of Technical Textiles grew from US$ 2,504.8 million in 2022-23 to US$ 2,585.9 million in 2023-24 registering a growth of 3.2% . This growth has been fueled by rising demand in sectors such as healthcare, agriculture, infrastructure, and automotive.
Outlook for 2024-25
We are optimistic about the prospects for 2024-25, as the global economy shows signs of recovery and inflation stabilizes in key markets. From April to July 2024, India’s exports of MMF textiles touched US$ 1571 million as compared to US$ 1551 million during the same period in 2022-23 registering a growth by 1.26% , while exports of technical textiles in April to July 2024 touched US$ 905 million as compared to US$ 861 million during the same period in 2022-23 registering a growth by approximately 5%.
Further , the United Nation projects a world output growth of 1.9% in 2023, marking one of the lowest rates in recent decades. However, for 2024, the global economy is expected to grow by 2.7% as countries worldwide show significant improvements, with inflation easing and markets gradually stabilizing. Notably, the demand for textiles, particularly technical textiles, is expected to witness a substantial growth in the upcoming months.
Export Target 2030
Looking further ahead, the Government has set an ambitious export target of US$ 11 billion for man-made fibre textiles and US$ 10 billion for technical textiles to be achieved by 2030. While these goals are attainable, they will require strategic investments in technology, sustainability, and capacity-building. MATEXIL will continue to collaborate closely with the Government and industry stakeholders to support this vision and drive growth in our sector.
Let me now briefly speak on the activities of the Council
Exhibitions
To promote exports of Manmade Fibre Textiles and Technical Textiles, the Council had participated in various Exhibitions along with its members. Some of the Exhibitions in which Council participated in 2023-24 were Irantex, Heimtextil , Texworld Paris, Istanbul Yarn Fair.
Representations
The Council extensively interacts with its members and takes feedbacks/suggestions etc. on various issues. Based on the inputs received from the members, the Council sends representations to the Government.
I would now like to speak on some of the important issues on which the Council has represented to the Government.
Exemption from QCO requirement
As you are aware, Government has imposed Quality Control Orders (QCOs ) on various products that are inputs for Textiles products . At the outset, we welcome QCOs as it will improve the quality of manufactured products and also prevent import of sub-standard products at cheaper prices . The Council had represented to the Government to exempt from the enforcement of QCO requirements on products imported against Advance Authorizations . The Council also worked very closely with the Government and had extensive discussions regarding the conditions that need to be imposed to grant the exemption. I am glad that Government has exempted various inputs used in textile products from QCO requirements on imports against Advance Authorizations. The Council is now trying to get similar exemptions on imports against DFIAs also. The Council has also represented to the Government to get theentire Value Chain of Textiles such Fibre , Yarns , fabrics and Madeups under QCO.
GST rate on Waste Bottles
There is a GST rate of 18% currently on Waste Bottles. The Council has represented to the Government to reduce this GST rate to 5% or alternatively to bring supply of Waste Bottles under the RCM (Reverse Charge Mechanism).
Extension of the RoDTEP Scheme.
RoDTEP Scheme (Remission of Duties and Taxes on Export Products Scheme)is valid till 30th September 2024 . The Council has represented to the Government for an extension of the RODTEP Scheme beyond September 30 , 2024 till 30th September 2025. This will enable the exporters to take a long-term perspective while negotiating business orders.
Input tax credits of GST on Inter- Unit transfer of Materials under the Advance Authorisation Scheme
The Advance Authorisation scheme allows inter- unit transfer of materials subject to payment of applicable rates of GST. However, input tax credits were not allowed on such transfers. The Council had represented on this issue to the Government and had proposed to allow input tax credits of GST on inter unit transfers . I am glad to inform you that Government has allowed input tax credits of GST on inter- unit transfers under the Advance Authorisation Scheme.
FIBC under the RoSCTL Scheme
FIBC ( Flexible Intermediate Bulk Containers) is an important Technical Textile product falling under the category of Packtech. FIBC is also one of the largest export products from the Technical Textile category. However, this product did not get any export benefits like RODTEP or ROSCTL . The Council represented to the Government to include FIBC under the RoSCTL Scheme. I am glad to inform you that Government has extended the RoSCTL Scheme to FIBC. However, due to some technical reasons, the scheme is yet to be implemented. The Council is pursuing on this issue with the Department of Revenue and the Ministry of Textiles and we are confident that the matter will get resolved and exporters of FIBC will start receiving the benefit of the RoSCTL Scheme shortly .
Surge in import of Man-made fibre fabrics
The Council had represented to the Government on the problems faced by the Manmade Fibre textile sector due to surge in imports of Manmade fabrics. I am glad that the Government has fixed Minimum Import Price on certain specified HS codes of MMF knitted fabrics. The Council has now represented to the Government to fix similar Minimum Import Price on MMF woven fabrics also.
Interest Equalization Scheme
The Interest Equalization Scheme has been extended till September 30, 2024. The Council has requested the government to extend the interest equalization scheme till 31st March, 2025. The Council has also represented to extend the benefit of the scheme to non-MSMEs exporting the 410 notified HS lines under the scheme. Further , the Council has proposed to include those exporters who get their products manufactured on job work basis also under the Interest Equalization Scheme.
PLI Scheme
The Government is actively working on PLI 2.0 scheme. The Council has represented to the Government to introduce PLI 2.0 scheme with a lesser benchmark for investments and turnover criteria. This will enable a large number of companies especially from the MSME category to invest and take advantage of the scheme.
Extension of RoSCTL Scheme to exports under the Advance Authorization Scheme
The benefit of the RoDTEP scheme has been extended to exports under the Advance Authorization Scheme and by EOUs . We have represented to the Government to extend the benefit of RoSCTL also on similar lines to exports under the Advance Authorization Scheme and to EOUs .
Duty Drawback Rates for Manmade Fiber Textiles and Technical Textiles
The Council had submitted detailed data for Duty Drawback rates to the Drawback Committee headed by Shri G. K. Pillai as its chairman and the Department of Revenue. The revised Duty Drawback rates announced by the Government are, by and large, satisfactory for Man-made fibre textiles and technical textiles products as per feedbacks from the exporters .
RoDTEP Rates & RoSCTL Rates
The Council has submitted data for revision in the RODTEP and ROSCTL rates . However, after the announcement of the Union Budget 2024, the Council is now working on furnishing revised data to the Department of Revenue for an increase in the RoDTEP and ROSCTL rates for Man-made Fibre textiles and technical textiles products . In this regard, the Council will be constituting an expert committee very shortly to review the duty incidence and to calculate the embedded taxes and duties incurred on the export products for submission to the Government . I would urge all our members to come forward and submit the required data to the Council. This will enable us to submit proposals for an increase in the RoDTEP and ROSCTL rates. Please note that both the RODTEP and ROSCTL schemes are data driven and based purely on the facts and figures submitted to the Department of Revenue . I would , therefore , appeal to all our members for support and furnish the data to the Council.
Procedural issues
While these are some of the important issues on which the Council had represented, we have also taken up the procedural issues faced by our members with the concerned Departments like Customs , Regional offices of DGFT , GST Commissionerates Office of the Textile Commissioner etc.
Some of the procedural issues faced our members which were taken up on a case-to-case basis are
- Shipping bills not appearing on the EDI system
- non-receipt of duty drawback, RoDTEP and RoSCTL claims
- pending claims under the ATUF Scheme etc.
The Council had also taken up the issues faced by the members on account of non- receipt of payments from their foreign buyers with the Indian Missions abroad.
Bharat Tex
I am pleased to announce that after a highly successful Bharat Tex 2024 held on February 2024, the next edition of Bharat Tex 2025 will take place from February 14th to 17th, 2025, at Bharat Mandapam in New Delhi. This flagship exhibition provides an excellent platform to showcase India’s capabilities in the MMF and technical textiles sectors. Bharat Tex 2024 was a tremendous success, and has now become the World’s biggest Textiles exhibition covering the entire value of Textiles & Clothing including Dyes & Chemicals, Machineries etc. I invite all our members to participate actively in Bharat Tex 2025 as exhibitors and contribute towards making this event a resounding success.
Sub-Committees
During the year , the Sub-Committees constituted by the Council for Manmade Fibers, Yarns, Fabrics, Made-Ups, and Technical Textiles consisting of experts from the industry have provided essential insights that have shaped our vision and action plan for exports. These Sub-Committees played a crucial role in formulating export growth strategies for all the categories of export products.
Initiatives for 2024-25
Looking forward, we have a range of initiatives planned for 2024-25. These include a targeted membership drive to onboard more exporters, participation in international events , organizing trade delegations, promotional roadshows for Bharat Tex 2025, and participation in key global exhibitions such as Heimtextil, Techtextil North America, International Istanbul Yarn Fair etc. We will also continue to organize webinars and seminars to educate our members on important topics like ESG compliance, market diversification, export finance etc.
Internal Challenges
Despite our achievements, several challenges remain. The limited availability of specialty fibers and high-tech machinery in India poses a barrier to growth, especially in the technical textiles sector. Additionally, the high cost of raw materials and the inverted duty structure within the MMF textiles value chain are issues which we are actively taking up with the Government. We are also urging the government to expedite the conclusion of Free Trade Agreements (FTAs) with the European Union and the UK to enhance market access for Indian exporters of Man-Made Fibre Textiles and Technical Textiles.
Way Forward
In the midst of the transformational shifts taking place throughout the world, MATEXIL is well positioned to reap the rewards of a growing international market for Manmade fibre textiles and technical textiles. The future of our industry hinges on innovation, sustainability, circularity and resilience. Rapid technological advancements and the increasing demand for sustainable products are shaping the textile landscape. MATEXIL is dedicated to supporting its members in adapting to these changes and seizing new opportunities in the global marketplace.
Conclusion
In conclusion , I would like to thank my colleague members of the Committee of Administration , all the Past Chairmen and Shri Shaleen Toshniwal , Vice Chairman for their invaluable support in guiding the Council through volatile times when there are multiple challenges at play .
I thank the Executive Director , Shri A. Ravi Kumar and all the officers and staff of the Council for their dedication , extraordinary commitment and untiring efforts in achieving the goals of the Council.
My special Thanks to all the Members of the Council for the trust you have reposed on us . You remain an invaluable pillar of strength and I look forward to your continued support in our journey towards achieving greater heights in the Exports of Manmade Fibre Textiles & Technical Textiles . Together, we will continue to work to build a bright and more prosperous future for our industry. Our Council MATEXIL assures you of our best services at all times.