In a bid to bolster the circular textile economy and effectively monitor imports and exports of recycled textiles, the Indian government has taken steps to establish a comprehensive record-keeping system. The Ministry of Textiles has created separate tariff codes, Harmonized System of Nomenclature (HSN) codes, to categorize recycled textile products specifically. The existing codes need to account for such products currently traded under the yarn, fabric, garment, and waste classifications.
Recycled textiles have gained significant popularity globally due to sustainability concerns, leading some countries to ban or limit their trade. By implementing dedicated HSN codes, Indian authorities aim to regulate and streamline the circulation of these products while ensuring compliance with sustainability standards and certifications.
Additionally, the Indian government is actively studying pre-and post-consumer waste generation to estimate the quantity of recycled textiles produced within the country. With plans to introduce six to eight-digit HSN codes covering recycled yarn, fiber, and fabric, India is also eager to collaborate with other nations in quantifying and addressing this critical matter.
This move aligns with the European Union’s Circular Economy Action Plan for 2030, highlighting textiles as a key sector facing sustainability challenges. Only a handful of companies dealing with recycled textiles are accounted for. However, with the proposed implementation of separate HSN codes, customs authorities, policymakers, and trade organizations will gain better oversight and management capabilities, paving the way for a more transparent and sustainable supply chain.
According to the IMARC Group, the Indian textile recycling market, valued at $8308.7 million in 2022, is projected to reach $375 million by 2028, with an anticipated compound annual growth rate of 3.4% between 2023 and 2028. This emerging sector holds immense potential, and introducing distinct HSN codes will help identify and trace recycled textiles, facilitating their integration into the formal economy.
Representatives from the Confederation of Indian Textile Industry have praised these measures, highlighting the significance of distinguishing and monitoring recycled textiles. Fashion waste and brand surplus stock have been singled out as major contributors to the textile waste challenge. By implementing the new HSN classification, transparent tracking of their trade activities will become possible, further enhancing supply chain transparency and accountability.
With the government’s decisive actions, India is poised to become a frontrunner in managing and regulating the trade of recycled textiles, aligning the nation’s textile industry with a sustainable and environmentally conscious path.
