Indian players: GST implementation hampered demand for PVC

As mentioned in earlier report, the Indian government is set to roll out the new good and service tax (GST) system starting 1 July 2017, which aim to streamline the country tax system and facilitate businesses. However, as the implementation date draw near, Indian companies, including those in the PVC sector are facing great confusion, causing a slow down in purchasing activities.

Players reported that GST rate is fixed at 18 per cent for all petrochemical products, and businesses are not ready for the new tax system at the moment. A trader said, “There are still a lot of confusion, hence our customers are not eager to place large orders. Besides, market is not fully recovered from the cash crises in the past few months.”

Another trader added, “Most cargoes purchased this month would arrive in July, when the new tax system is already in place and also the beginning of the monsoon season. Many customers refused to place orders because of these reasons. We think sentiment in June is not very strong either.”

Couple of other international suppliers also complained about the difficulties they face in attracting buying interest in India this month as buyers here prefer to wait for clearer guidelines on the GST system before making purchases.