New Delhi, July 22: Synthetic yarn manufacturers have demanded a cut in customs and excise duties as the crude oil spike has caused huge losses and could result in the closure of several units.

“There are about 200 mills manufacturing blended and synthetic yarn. All the mills have suffered losses and if the government does not come to the rescue by reducing taxes, a large number of these mills will close down,” said V. K. Ladia, president of the Indian Spinners Association.

“The industry is in crisis as the cost of raw material has gone up 32 per cent in the past four months,” he said.

The yarn makers are raising the issue of scrapping duty on their raw material after the government yielded to a similar demand from cotton yarn spinners following a day’s strike early this month. They have asked for a reduction in excise duty from eight per cent to four. There is also a five per cent customs duty on fibre. The government has already cut the customs duty on crude to zero. The association blamed domestic fibre producers for a peculiar method of pricing, on an import parity basis, which gives them an additional boost of 28 per cent.

Synthetic fibre, a petroleum downstream product, should be treated on a par with crude oil for import duty. The association has delivered several representations to ministries of finance and textile.

Five leading yarn mills — Rajasthan Spinning & Weaving Mills, Shree Rajasthan Syntex Ltd, Sangam (India) Ltd, APM Industries Ltd and Sutlej Textile and Industries — have seen a sharp decline in profits up to 80 to 99 per cent, in the last fiscal.