JOIN USIn its pre-budget memorandum to Finance Minister Pranab Mukherjee, the Confederation of Indian Textile Industry (CITI) said, “excise and customs duties on all man-made fibre may be removed. Countervailing duties imposed on import of all fibres may be removed, since access to cheaper global fibres will improve cost-competitiveness.”
Textile Minister Dayanidhi Maran had last week said an expert group would be appointed within 100 days to chalk out a roadmap for fibre-neutral policy. He said the new policy should be in place within a year.
While there is no customs duty on cotton, the import of synthetic fibre attracts 5 per cent, putting the user of the man-made fibre at a disadvantage.
Special export package
CITI has asked for a special export package, since 50 per cent of total production in the sector gets exported.
“The significant decline in demand in major markets and additional incentives introduced by our competitors during the last one year, make it essential that the industry be assisted with proper policy to make it more competitive,” it said.
CITI has also demanded that the export sop of 5 per cent announced under the Vishesh Krishi Gram Udyog Yojana for raw cotton till June 30 this year be terminated apparently to boost domestic supply for millers.
The industry has sought exemption from the Fringe Benefit Tax, levied around 7 per cent of income, for textile and clothing units, saying “sluggish markets necessitate extra marketing efforts including foreign travels.” FBT makes such efforts costlier and adds to the losses of units, it added.
Further, it said, textile exports have declined by over 10 per cent in 2008-09, the industry has asked for working capital loans at a concessional interest rate of 7 per cent in order to partly bridge the gap between the cost of working capital in India and in other countries.