QCO withdrawal to lower input costs, widen sourcing base for textile MSMEs

Withdrawal of quality norms will immediately ease import restrictions

- NARAYANAN V

THE WITHDRAWAL OF 14 quality-control orders (QCOs) — including those covering key textile raw materials such as polyester fibre and yarn — will significantly widen low-cost sourcing options for domestic manufacturers, especially MSMEs, helping them reduce production costs, industry executives said.

The removal of these non-tariff barriers will also benefit the polymers-to-plastics value chain.

Major domestic producers of these industrial inputs — including Reliance Industries, IndoRama, Indian Oil Corporation, GAIL (India) and ONGC Petro Additions — may face greater competition from imports, as they will need to adhere to “import parity” pricing. Some imported materials may become cheaper than local supplies even after tariffs and freight, compelling upstream producers to recalibrate their prices. China is a major supplier of polyester inputs to India, while Indonesia, Korea and Thailand are also potential exporters.

“The withdrawal of QCOs will immediately ease import restrictions, leading to greater availability of raw materials at more competitive prices,’ said Suketu Shah, CEO of Vishal Fabrics, Ahmedabad-based denim manufacturer. He added that removing the QCOs will help resolve supply-side constraints faced by manufacturers, particularly MSMEs, by reducing certification delays and cutting input costs.