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Chinese silk import surges on low prices

Vishwanath Kulkarni

BANGALORE, May 27

A SHARP decline in prices has seen Chinese silk imports into the country surging over the last one year. While Chinese prices have dropped by around 38 per cent from $25 to $15.5 a kg since April 2001, imports have gone up by 34 per cent.

The Central Silk Board sources said the estimated imports during 2001-02 could touch 7,500 tonnes as against 4,713 tonnes in 2000-01. Available data indicates that silk imports stood at 5,920 tonnes till February 2002 (4,418 tonnes in corresponding period last year).

Taking into account the unofficial imports, mainly smuggled into the country through the land route from Nepal, the total imports would have easily crossed the 10,000 tonne mark, sources said.

Apart from low prices, the lowering of customs duty from 35 to 30 per cent in this year's Budget had also helped the imports, sources said. The decline in Chinese prices is mainly attributed to the fall in global demand, especially after the September 11 attacks.

India is a major importer of Chinese silk. The Indian silk industry, especially the weavers crave for Chinese silk because of its quality and uniformity. Also it is cheaper compared to the domestic variety. It is estimated that the domestic demand for raw silk is about 25,000 tonnes while the production is around 14,000 tonnes. Industry sources said about 4,000-5,000 tonnes is imported officially while an equal quantity is smuggled into the country.

``The surge in imports has had a dampening effect on the prices in the domestic market,'' said Mr P. Joy.Oommen, Member Secretary and CEO, Central Silk Board. The average prices of raw silk are ruling between Rs 800 and Rs 1,000 a kg (depending on the variety) as against Rs 1,000-1,400 a year ago.

Cocoon prices have also registered a sharp decline compared to last year levels. The only consoling fact for the grower was that his productivity had increased following which he was able to offset the losses caused by falling prices, said Mr Oommen.

With prices expected to remain at low levels, the imports are likely to be higher unless the Government intervenes to curb it. CSB was in the process of suggesting some measures to curb imports, Mr Oommen said.

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