Surat, April 3 (NationPress) The Indian government has announced a significant reduction in the basic customs duty on over 40 essential petrochemical raw materials to zero, effective for a three-month period. This strategic move aims to alleviate the financial burden on Surat’s textile and plastics sectors, which have been grappling with escalating global input costs.

The previous duty of 7.5 percent has been eliminated for key materials such as purified terephthalic acid (PTA) and monoethylene glycol (MEG), both of which are vital for the manufacturing of man-made fibers.

This relief measure will be in effect through April, May, and June. Industry leaders in Surat commented that this decision arrives as crude oil prices, driven by geopolitical tensions, have sharply raised production expenses.

Nikhil Madrasi, President of the Southern Gujarat Chamber of Commerce and Industry, noted that crude oil prices have nearly doubled within the last month, resulting in yarn prices surging by as much as 30 percent.

“With the customs duty now set to zero, we anticipate a reduction in production costs by approximately 5 to 10 percent. Yarn producers have already begun to lower prices by up to Rs 7 per kilogram,” he explained, remarking on the positive implications for the man-made fiber industry.

Bhavin Vora, Director of Polymer Bazaar, indicated that raw material costs had surged by 50 to 60 percent from March 1 to March 10, complicating order fulfillment for many manufacturers.

“Prominent producers have already cut PET prices by up to Rs 5.5. This decision by the government is particularly beneficial for micro, small, and medium enterprises (MSMEs),” he stated.

Pradeep Parikh, a yarn trader based in Surat, mentioned that reduced input expenses would enable small and medium enterprises to regain their competitive edge in export markets.

“This policy could yield a direct positive influence of 7 to 10 percent on the yarn market,” he noted.

Lalit Sharma, a textile trader and President of the Textile Youth Brigade, pointed out ongoing export disruptions caused by tensions affecting crucial shipping lanes, such as the Strait of Hormuz.

“During a time when weavers faced challenges from inflated yarn prices and logistical issues, this decision provides essential relief. It will assist in price stabilization and offer the industry some respite amid the current downturn,” he commented.

Industry experts believe that the temporary cut in customs duty may help restore order flows and alleviate working capital challenges, although they cautioned that long-term stability will rely on global pricing trends and supply chain conditions.