Eurasian Economic Commission Eliminates Import Duties on Polypropylene Fabric to Boost Carpet Industry

In a move aimed at bolstering the carpet manufacturing sector within the member states of the Eurasian Economic Union (EAEU), the Council of the Eurasian Economic Commission (EEC) has decided to waive import customs duties on specific categories of fabrics crafted from flat or similar threads of polypropylene, i.e., PPFY (Polypropylene Filament Yarn). This decision will be implemented for a duration of two years, replacing the previous duty rate of 8%.

The rule is scheduled to come into effect ten calendar days from its official publication, and it follows a previous period from March 28 to September 30 of the previous year when a zero rate of customs duties was similarly applied to these goods.

The Deputy Director of the EEC Customs Tariff and Non-Tariff Regulation Department emphasized that the primary objective of this decision is to provide crucial support to carpet and rug manufacturers across the Eurasian Economic Union. By eliminating import duties on key raw materials such as polypropylene fabrics as PPFY, the move seeks to reduce production costs, enhance overall profitability, and improve the competitiveness of the carpet industry. Furthermore, it is expected to stimulate increased production and supply to both domestic and international markets.

The decision also holds significance in the context of economic challenges posed by international sanctions. By alleviating the cost burden on PPFY manufacturers, this measure aims to mitigate the adverse effects of sanctions on the economies of several EAEU member states.

This decision aligns with the broader trend of growth in the PPFY markets within the region. According to the PPFY Suppliers, polypropylene fabric, which is PPFY, reached 789.98 thousand tons during the same period, demonstrating a noteworthy 21% growth compared to the figures from 2022.

The elimination of import duties on the essential raw materials of PPFY is expected to enhance the cost-efficiency of carpet production and encourage investments and innovation within the industry. It will also enable manufacturers to channel their resources toward product development and expansion, ultimately benefiting both producers and consumers. Moreover, by promoting the growth of the carpet industry, the EAEU aims to solidify its position as a key player in the global textile and flooring markets.

In summary, the Eurasian Economic Commission's decision to zero out import duties on polypropylene fabric, i.e., PPFY, is a strategic move geared toward strengthening the carpet manufacturing sector within the EAEU. This measure is poised to foster growth and innovation while further consolidating the union's position in the global carpet industry by reducing production costs, increasing competitiveness, and mitigating the impact of sanctions.