The Yarn of Sustainability: Munjal International’s Role in Transforming Textile Waste into Premium Yarns

Posted on August 18 , 2025

Introduction

The textile industry, a cornerstone of global trade and cultural heritage, is at a pivotal moment. With sustainability at the forefront of global conversations, the industry is embracing innovative ways to reduce waste and promote eco-friendly practices. In India, particularly in the textile hub of Panipat, Haryana, Munjal International is leading the charge by transforming textile waste into high-quality yarns. This blog explores the significance of HSN codes 5202 (cotton waste), 5205 (dyed cotton yarn), 6310 (cotton cutting waste), and 520611/520612 (cotton yarns), delving into their role in the Indian and international textile markets, and highlighting Munjal International’s contributions to sustainable growth.

Understanding HSN Codes in the Textile Industry

The Harmonized System of Nomenclature (HSN) is a globally recognized classification system for goods, essential for trade, taxation, and compliance. In the textile sector, HSN codes ensure accurate categorization, enabling businesses to navigate GST regulations and international trade seamlessly. Let’s break down the key HSN codes relevant to this discussion:

• HSN 5202: Cotton Waste (Including Yarn Waste and Garnetted Stock)
This code covers cotton waste, including yarn waste (52021000), garnetted stock (52029100), and other cotton waste (52029900). These materials are byproducts of textile manufacturing, such as thread waste or fabric scraps. In India, cotton waste is taxed at a GST rate of 5%, reflecting its importance as a recyclable resource.
• HSN 5205: Cotton Yarn (Other Than Sewing Thread, Containing ≥85% Cotton, Not for Retail Sale)
This category includes dyed cotton yarns (e.g., 52051130 for dyed single yarn of uncombed fibers). These yarns are critical for weaving and knitting, serving as the backbone of fabric production. The GST rate for these yarns is also 5%, supporting their widespread use in both domestic and export markets.
• HSN 6310: Used or New Rags, Scrap Twine, Cordage, Rope, and Cables of Textile Materials
This code encompasses cotton cutting waste, such as fabric scraps from garment manufacturing. These materials are often repurposed into recycled yarns, contributing to circular economies. The GST rate varies but is typically low to encourage recycling.
• HSN 520611 and 520612: Cotton Yarn (Containing <85% Cotton, Not for Retail Sale)
These codes cover cotton yarns with less than 85% cotton content, including uncombed (520611) and combed (520612) single yarns. These yarns are versatile, used in blended fabrics for durability and affordability, and are taxed at 5% GST.

These HSN codes are vital for businesses like Munjal International, enabling precise classification, compliance, and efficient trade in both Indian and international markets.

The Indian Textile Industry: A Global Powerhouse

India’s textile industry is a vibrant tapestry of tradition and innovation, contributing significantly to the nation’s economy. With a market size of over $150 billion, it accounts for 7% of India’s industrial output and 15% of its export earnings. The industry spans cotton farming, yarn production, weaving, and garment manufacturing, with hubs like Panipat, Surat, and Coimbatore playing pivotal roles.

Panipat, often called the “Textile City of India,” is renowned for its production of yarns, home furnishings, and recycled textiles. The city has become a global leader in recycling textile waste, transforming scraps into high-value products like yarns and blankets. This aligns with India’s broader push for sustainability, as seen in initiatives like the “Manjapai” campaign in Chennai, where old clothes are repurposed into reusable bags.

Globally, India is the second-largest textile exporter, with a strong presence in markets like the USA, EU, and Bangladesh. However, challenges such as reliance on foreign cotton seeds and fragmented supply chains persist. The shift of low-cost textile production to countries like Bangladesh and Pakistan in the 1970s led to job losses in India, underscoring the need for innovation and value-added products.

The Role of Textile Waste in Sustainability

Textile waste, classified under HSN codes 5202 and 6310, is a critical resource for sustainable practices. Globally, the textile industry generates millions of tons of waste annually, from yarn scraps to garment cuttings. In India, Panipat’s recycling ecosystem has turned this challenge into an opportunity. Cotton waste (HSN 5202) and cotton cuttings (HSN 6310) are collected, sorted, and processed into recycled yarns, reducing landfill waste and conserving resources.
Dyed cotton yarns (HSN 5205) and blended yarns (HSN 520611/520612) further enhance sustainability by incorporating recycled fibers. These yarns meet the growing demand for eco-friendly textiles in fashion and home decor, particularly in international markets where sustainability is a key purchasing factor.
Munjal International: Pioneering Sustainable Yarn Production
Based in Panipat, Munjal International is at the forefront of transforming textile waste into premium yarns. With over 15 years of experience, the company has established itself as a leader in producing cotton yarn, recycled melange yarn, knitting yarn, and weaving yarn. Its Regeneration Programme is a cornerstone of its operations, converting fashion industry waste and PET bottle waste into high-quality yarns.
Key Contributions of Munjal International:

1. Sustainability Through Recycling
Munjal International repurposes cotton waste (HSN 5202) and cotton cuttings (HSN 6310) into recycled yarns, aligning with global sustainability goals. By processing fabric scraps and yarn waste, the company reduces environmental impact and supports a circular economy.
2. Premium Yarn Production
The company produces dyed cotton yarns (HSN 5205) and blended yarns (HSN 520611/520612) that meet international quality standards. These yarns cater to global fashion clients, contributing to India’s export growth, particularly in markets like North America, where companies like Gokaldas Exports derive significant revenue.
3. Innovation and Certifications
Munjal International integrates innovative recycling methods, ensuring minimal environmental impact. Its certifications validate its commitment to quality and sustainability, enhancing its credibility in international markets.
4. Economic Impact in Panipat
By operating in Panipat, Munjal International supports the local economy, creating jobs and fostering skill development. The company’s focus on recycled yarns aligns with Panipat’s reputation as a recycling hub, reinforcing the city’s role in global textile markets.
5. Global Competitiveness
Munjal International’s emphasis on sustainability and quality positions it to compete in the global market, where demand for eco-friendly textiles is rising. By leveraging India’s textile heritage and Panipat’s recycling expertise, the company contributes to India’s vision of becoming a global textile leader.

The Road Ahead: Challenges and Opportunities

While Munjal International is driving sustainable growth, the textile industry faces challenges. The reliance on manmade fibers (70% of the global market) versus cotton (30%) highlights the need for diversification. Additionally, fragmented supply chains and dependence on foreign technology require strategic interventions.

However, opportunities abound. The global push for sustainability, coupled with India’s policy support for textiles (e.g., government initiatives highlighted by Minister Pabitra Margherita), creates a favorable environment. Munjal International is well-positioned to capitalize on these trends by expanding its recycling programs and targeting high-value export markets.

Conclusion

Munjal International is weaving a sustainable future for the textile industry by transforming cotton waste (HSN 5202), dyed yarns (HSN 5205), cotton cuttings (HSN 6310), and blended yarns (HSN 520611/520612) into premium products. Rooted in Panipat’s vibrant textile ecosystem, the company is not only contributing to India’s economic growth but also redefining global textile standards through sustainability and innovation. As the industry evolves, Munjal International’s commitment to quality, environmental stewardship, and global competitiveness will continue to shape a greener, more prosperous future.

Call to Action

Explore Munjal International’s range of sustainable yarns and join our mission for a greener planet. Subscribe to our newsletter at munjalinternational.com for the latest updates on our products, sustainability initiatives, and industry insights.

~ Chandan Munjal