QCO takes effect for polyester fibre in India; industry divided

India has extended the deadline for mandatory QCO on four orders—polyester fully drawn yarn, polyester partially oriented yarn, polyester industrial yarn, and 100 per cent polyester spun yarn—until July 2, 2023. The ministry of chemicals and fertilisers had previously issued Quality Control Orders requiring BIS certification for the import and domestic sale of various polyester products, including 100 per cent polyester staple fibre yarn. 

Domestic polyester fibre and product manufacturers have obtained BIS certifications, ensuring no supply disruptions from domestic producers, as per market experts. Some foreign manufacturers have also secured certification, while many others are still awaiting approval. A senior industry official told Fibre2Fashion, “The Indian government had initiated the mandatory QCO two years ago and provided ample time for BIS certification. Standardising polyester products will improve quality in the Indian textile industry, aligning with the government's long-term vision. Some implementation issues may arise initially, but the overall quality of polyester products is expected to improve.” 

However, the domestic yarn industry is not pleased with the new provisions, viewing them as regulatory support for dominant local suppliers. They argue that these suppliers will be able to dictate higher prices in the absence of competition from global suppliers. Domestic producers counter that their plants are operating at lower capacities due to an influx of imported supply, and they can meet any raw material shortages if imports decrease due to QCO implementation. 

Trade data suggests that there is no flooding of imported polyester fibre in the country. India’s import of polyester fibre (HS Code 550320) has remained stagnant. India imported 84 million kg of polyester fibre (HS Code 550320), valued at $111.192 million, in 2022. This represents a slight increase, but not flooding. Imports were 82.113 million kg ($103.002 million) in 2021, 82.325 million kg ($82.957 million) in 2020, 116.737 million kg ($138.878 million) in 2019, 83.285 million kg ($116.448 million) in 2018, and 91.248 million kg ($105.357 million) in 2017, according to Fibre2Fashion's market insight tool TexPro. Imports increased in 2018 and 2019 but did not recover from the COVID disruption even after three years. 

Fibre2Fashion News Desk (KUL)