Man-made fibre exports dip, imports rise in FY21
Declining exports and increasing imports of man-made fibre and filaments in FY21 is a worry for the textile sector, which considers MMF a focus area to achieve a
$350 million export target for textiles.
MMF exports declined by 17.5 per cent to 1 million tonnes between April
2020 and February 2021. However, during the 11month period, imports of MMF increased by 12.5 per cent to 542,000 tonnes.
The fall in MMF outbound shipments was spread across almost all the varieties in a range of
6 per cent to 58 per cent. The shipments were affected mainly due to
Covid-19 disturbances. The overall exports are estimated to have accounted for about 30 per cent of the total MMF production, as per the data from Department of Chemicals and Petrochemicals.
However, the production itself declined by 27.6 per cent year-on-year to 2.4 million tonnes during the period April and January 2021. The fall in output was mainly due to an average decrease of 56.7 per cent in production during the first five months of FY21 because of Covid-19 disruptions.
Meanwhile, imports of polyester filament yarn (PFY) and other synthetic yarn increased by 70 per cent and 29.6 per cent, respectively. This, in turn, increased overall MMF imports during the period. A surge of 127.2 per cent and 121.7 per cent in imports of PFY and other synthetic yarn from China was primarily responsible for the overall growth in inbound shipments of these varieties. Yarn from China has become cheaper than domestic yarn, says Care Ratings. According to Rakesh Mehra, convenor, sub-committee on manmade fibre & yarn, Confederation of Indian Textile Industry, exports across the value chain were affected by the demand in key markets like Europe and the US.
The export of MMF ready-made garments also declined by 25.2 per cent in FY21. Aligning itself with the global textile market, India had started promoting MMF exports in the past couple of years. Promotion of MMF is also important in achieving the targeted textile exports to $350 million by 2025.
The government announced a production-linked incentive (PLI) scheme in November 2020 for the MMF segment and technical textiles for Rs 10,683 crore. Besides, a scheme of Mega Investment Textiles Parks has also been proposed in the Budget 2021-22 to enable the textile industry to become globally competitive and attract large investments.
"Increasing exports from around $40 billion to $300 billion in five years is quite ambitious without preferential and free trade agreements with key markets. Our exports have been hovering around $40 billion for the past few years," said Mehra.