Bhadohi Carpets, Moradabad Brassware Become 6–7% Cheaper After GST Relief
GST Reforms Impact in UP: The savings festival that has begun after GST 2.0, the rate cut, is expected to benefit small businesses in Uttar Pradesh on a large scale. The benefits of the GST reduction are being felt in Bhadohi, Moradabad, Saharanpur, and Jaunpur. Read this report.
The Goods and Services Tax (GST) reform has offered relief to Uttar Pradesh's diversified economy, such as GI-registered zardosi, brassware, carpets, shoes, ceramics, sports goods, and cement. Reduced tax rates will enhance affordability for households and alleviate working capital constraints on artisans. This will enhance the competitiveness of small and medium-sized enterprises (MSMEs) in both domestic and international markets.
The lower GST rates are likely to cut prices of Bhadohi carpets, Moradabad brassware, and Saharanpur wood products by 6-7 percent. This will increase exports and provide jobs for millions of artisans. The Bhadohi, Mirzapur, and Jaunpur areas account for one of India's largest handwoven and carpet clusters.
These carpets have become cheaper after the GST rate was reduced from 12 to 5 percent. The leather and footwear clusters in the Kanpur-Agra region, which employ 1.5 million workers, will also benefit from the GST rate reduction. This will improve the competitiveness of MSMEs and increase exports. The wooden toy and craft sector will receive a boost, driven by family artisans, many of whom work from their homes.
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The clusters in Varanasi and Chitrakoot alone employ approximately 15,000-25,000 artisans. Thousands of artisans engaged in woodworking and carving reside in Saharanpur. Rampur is also part of this traditional craft network. These clusters meet strong domestic demand through fairs, religious toys, and decorations. They also export modestly to Europe and the Gulf countries.
The reduction of GST to 5 percent is expected to make toys and small crafts cheaper. This will increase their affordability in local markets and help artisans compete with machine-made plastic products. The sports goods clusters in Meerut and Modinagar, where 30,000–35,000 workers are employed in small units, MSMEs, and large factories, will also benefit. This region produces cricket and hockey equipment worth approximately ₹250 crore for the domestic market and also exports it to the UK, Australia, Africa, and the Middle East.
