NEW DELHI: A high-level delegation led by Dr. Vinod Kumar Bind, Member of Parliament (Bhadohi), along with Kuldeep Raj Wattal, Chairman, Carpet Export Promotion Council (CEPC), met Piyush Goyal, Minister of Commerce & Industry, Government of India, to highlight the grave challenges facing the Indian handmade carpet industry.
The delegation also included Raza Khan, President, AICMA, Aslam Mehboob, Piyush Kumar Baranwal, Sanjay Gupta, Mahavir Pratap Sharma (all Members COA, CEPC), and Rajesh Sharma, Managing Director, Obeetee Pvt. Ltd.
The same delegation later met Pankaj Chaudhary, Minister of State for Finance, to apprise him of the urgent policy and financial concerns of the sector.
Dr. Vinod Kumar Bind emphasized that more than 20 lakh weavers and artisans, largely from rural Uttar Pradesh, Rajasthan, Haryana, and J&K, depend on the handmade carpet industry for livelihood. He underlined that safeguarding this heritage craft is not just about trade but also about rural employment, women empowerment, and preserving India’s cultural identity.
Industry Snapshot
- Valued at USD 2,097 million, the Indian handmade carpet industry is labour-intensive, with wages comprising 55–65% of production costs.
- The U.S. is the largest market, accounting for nearly 60% of exports.
Immediate Crisis – U.S. Tariff Escalation
The delegation expressed deep concern over the U.S. imposing nearly 50% import duty on Indian handmade carpets, leading to:
- Order cancellations and renegotiations
- Looming unemployment and distress migration of weavers
- Permanent skill erosion and destabilisation of rural economies
“This is a socio-economic emergency, not merely a trade issue,” the delegation underlined.
Other Key Concerns
- Delay in Export Promotion Mission Scheme: Expected in April–May, its delay has stalled MAI Scheme support, restricting exporters’ participation in international exhibitions.
- Unfair Competition: Urgent need for a separate HSN code for handmade carpets to distinguish them from machine-made imports.
- Trade Barriers: Turkey imposes 75% duty on Indian carpets while its machine-made carpets enter India at low duty.
Relief Demands
- Special Bailout Package – 20–25% of annual U.S. export value to safeguard jobs and sustain liquidity.
- Income Tax Relief – Reinstate Section 80HHC or create a special exemption scheme.
- Higher Duty Drawback & RoDTEP Rates – To reflect actual input costs.
- Interest Equalisation Scheme (IES) – Extend for 3 years, raise subvention from 3% to 5%.
- Relaxation under Section 43B(h) – Extend 15/45-day payment condition to 180 days for this export-oriented sector.
- Exemption on Interest-Free Packing Credit – To ease liquidity and sustain competitiveness.
Government’s Response
- Piyush Goyal assured the delegation of full support and directed officials to:
- Create a separate HSN code for handmade carpets.
- Consider raising import duties on Turkish machine-made carpets.
- Resume the MAI Scheme shortly.
- Develop new export markets through official trade delegations.
- Pankaj Chaudhary assured that the Ministry of Finance will carefully examine issues like Section 43B(h) and IES enhancement, and extend all possible support to safeguard this vital sector.
Acknowledgement
On behalf of the industry, Chairman CEPC Kuldeep Raj Wattal, Raza Khan, President AICMA, and other members expressed gratitude to Dr. Vinod Kumar Bind, MP, for his leadership in strongly raising the concerns of the handmade carpet industry and working to safeguard the livelihoods of 20 lakh weavers across India.
