The Confederation of Indian Textile Industry (CITI) has extended its appreciation to the Government for the recent announcements made on the Goods and Services Tax (GST) front, particularly concerning the textile value chain.

Initial reaction of Confederation of Indian Textile Industry (CITI) Chairman Rakesh Mehra to the GST announcements:

“We thank and welcome the rectification of the GST inversion in the Man-Made Fibre (MMF) value chain by aligning MMF fibre and yarn at 5% from 18% and 12% earlier respectively. It addresses the long-standing blockage of working capital for thousands of spinners and weavers. With over 70-80% of textile and apparel units in India being MSMEs, this reform will directly benefit a large segment of the industry by easing liquidity pressures, enhancing competitiveness.”

The move to align the GST rates across the MMF value chain marks a significant step toward rationalizing the tax structure in the sector, which had long suffered from an inverted duty structure. Industry experts have highlighted that this reform will reduce the burden on spinners, weavers, and small-scale manufacturers, allowing them to channel their working capital into business expansion and modernization.

The textile and apparel industry, one of India’s largest employers and contributors to exports, has consistently sought parity in taxation between man-made fibres and cotton. The new GST rates are expected to create a more balanced environment, ensuring fair competition and strengthening India’s position in the global textile market.