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Saturday, Oct 02, 2004

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Import duty on polymers cut

K.R. Srivats

New Delhi , Oct. 1

THE Finance Ministry on Thursday lowered basic customs duty on a host of polymer feedstocks, intermediates and finished goods as part of its overall attempt to reduce inflation.

A senior Finance Ministry official maintained that the revenue loss to the exchequer from the duty cuts "would not be very significant" as the imports of polymers into the country are not large.

On finished polymers, the Finance Ministry has lowered the basic customs duty on certain polymers of ethylene - low-density polyethylene (LDPE), linear low-density polyethylene (LLDPE), high-density polyethylene (HDPE), linear high-density polyethylene (LHDPE) and linear medium density polyethylene (LMDPE) - from 20 per cent to 15 per cent.

Further, the basic customs duty on polymers of vinyl chloride has also been lowered from 20 per cent to 15 per cent.

The revenue department has also cut the basic customs duty on naphtha used for the manufacture of LDPE, LLDPE, HDPE, LHDPE, LMDPE and polymers of vinyl chloride from 10 per cent to 5 per cent.

On the intermediates front, the Finance Ministry has lowered the basic customs duty on imports of ethylene, butylenes, butadiene, benzene, toluene, 0-xylene, styrene, ethylbenzene, ethylene dichloride (EDC), vinyl chloride monomer (VCM) and acrylonitrile from 15 per cent to 10 per cent.

As part of its anti-inflationary strategy, the United Progressive Alliance Government had in the recent months altered the customs duty structure on petro-products and steel.

India's wholesale price index (WPI)-based inflation, which had hovered near 8 per cent in the recent weeks, slipped to 7.8 per cent in the week that ended on September 18.

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