Transcript - TMMA. Textile Machinery Manufacturers` Association

TEI PERSPECTIVE
RATIONALIZATION OF 2ND HAND MACHINE IMPORT
IN CAPITAL GOODS INDUSTRY
Mr. J. Anand
Vice Chairman, Textile Machinery Manufacturers’ Association (INDIA)
DHI and Capital Goods Industry Meeting
30th September, 2014, Udyog Bhavan, New Delhi
OVERVIEW of DOMESTIC
PRODUCTION & IMPORT - WEAVING
 Import of secondhand shuttleless looms started in a big way after
the liberalization of trade and industrial policy of the Government.
 Since year 2000, only 1,50,000 shuttleless looms installed till date.
 It took more than 20 years for textile industry to do so.
 Whereas China has installed 7,50,000 shuttleless looms within the last
10 years.
 The revised policy of the Government has reduced the import of
secondhand shuttleless looms in the country


Imposition of higher duty for secondhand machines
Reduction of subsidy under TUFS-30% CLCS for the second hand
machines
 Off late import of secondhand shuttleless looms have dropped to
22% during 2013-14 from the level of 82% during 2011-12.
 Indian manufacturers successfully developed and installed low-cost
basic technology shuttleless rapier looms in the country.
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TEI IMPORT DATA
INCLUDING USED MACHINES
HS
CODE
2008-09
2009-10
2010-11
2011-12
2012-13
Total
Used
Total
Used
Total
Used
Total
Used
Total
Used
8444
208.69
5.15
239.03
5.55
112.47
2.37
116.67
3.65
635.94
13.53
8445
1857.16 193.39
1272.57
284.87
1914.69
187.78 2923.61 161.18
2602.97
135.12
8446
803.52
290.93
1068.52
418.63
1510.19
597.53 1694.90 565.75
1937.01
410.59
127.8
432.48
96.91
237.02
84.17
366.77
54.44
258
112.18
8447
8449
23.21
0.92
18.03
3.6
77.77
1.84
178.15
9.95
195.95
13.27
8451
1050.25
38.85
782.53
64.74
909.52
60.78
927.87
51.56
872.14
45.98
Total
5343.04 657.04
5342.94
874.3
6326.36
934.47 6882.46 846.53
7500.83
730.67
* 8446 – Weaving Machines
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IMPORT OF SHUTTLE LESS LOOMS
*(Source: Private)
Loom Import
2008-09
No.
Value
(Rs. Cr)
2009-10
No.
Value
(Rs. Cr)
2010-11
No.
2011-12
Value
(Rs. Cr)
No.
2012-13
Value
(Rs. Cr)
No.
Value
(Rs. Cr)
New Rapier
1138
110.97
1607
164.36
154
11.9
219
225.54
4829
476.82
New Air Jet
507
127.46
692
225.12
1765
404.15
226
54.86
2790
774.7
New Water Jet
--
--
--
--
--
--
1130
67.03
1991
147.82
New Projectile
--
--
--
--
--
--
--
--
17
5.58
389.48
1919
416.05
1575
347.43
9627
1404.92
Total (1)
1645
238.43 2299
Used Rapier
548
38.63
2644
164.44
3719
249.07
3637
290.78
2352
227.99
Used Air Jet
153
12.08
900
324.66
1062
57.92
1311
104.58
484
41.48
Used Water Jet
246
6.63
1474
96.37
1497
49.38
447
17.25
141
6.77
Used Projectile
407
32.71
2060
307.06
2161
15.65
1624
144.97
1428
115.25
Total (2)
1354
90.05
7078
892.53
8439
372.02
7019
557.58
4405
391.49
Grand Total
(1+2)
2999
328.48 9377
1282.01
10358
788.07
8594
905.01
14032
1796.41
Used Loom %
45%
75%
81%
82%
31%
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INDEGENOUS SHUTTLELESS LOOMS
TYPE
RAPIER
SPEED (rpm)
Remarks
180 to 275 rpm
Already installed - over
8000 nos
350 rpm
400 rpm
600 rpm
AIRJET
800 rpm
WATER
JET
800- rpm
Unable to compete with
imported new &
secondhand shuttleless
looms
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IMPORT – MATTER OF CONCERN

Dual Subsidy on Imported Looms - Firstly, an export subsidy
by the Chinese Government and Secondly TUFS offered by the
Indian Government

No benchmarking applicable to imported machines

Second hand imported machines are often accompanied by
unscrupulous trade practices (over invoicing, non-existent or
insufficient after-sales services and recycling of used parts
and components, sometimes, even entire machines).

Of late lot of Second hand machines are refurbished and
imported in the disguise of new looms.
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TEI – PROPOSAL FOR POLICY
INTERVENTIOAN

No incentive for import of secondhand machinery in the form
of Subsidies under TUFS or concessional import duty against
export commitments

Introduce import duty on second hand machines similar to
Automobiles sector

Only secondhand machines of 5 years’ vintage may be
allowed for another period of 3 years

Only the old shuttleless rapier looms which are capable of
working at a minimum speed of 400 rpm should be allowed.

Benchmarking should be introduced for imported machines as
well.
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AUTOMOBILES IMPORT– CASE STUDY
Overall import duty on new/ used automobile is more than 100%.
Relevant sources:
http://www.cybex.in/indian-custom-duty/Motor-Cars-Duty-Calculator-87032391.aspx
https://sites.google.com/site/secoshippingservices/services/imports/import-of-used-motorvehicles-to-india
https://in.answers.yahoo.com/question/index?qid=20080903084223AALaVgO
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Thank You
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