Textile Ministry to pitch for relief in the Budget

Industry needs restructuring of duty on textile products and machineries

“The Ministry will submit a list of proposals to the Finance Minister seeking relief for the textile industry—currently being hit by the ongoing economic slowdown,” highly placed sources in the Textile Ministry told Deccan Herald.

The newly appointed Textile Minister Dayanidhi Maran is understood to have directed his Ministry to prepare a “comprehensive” report suggesting fiscal measures to provide relief to the overall textile industry. “Based on interactions with industry representatives the Ministry will submit its recommendations to the Finance Ministry,” sources said.

Duty restructuring

The Textile Ministry is of the view that the economic slowdown has badly impacted the textile industry and it should be given relief through duty “restructuring”, sources said.
The duty on wide range of textile machinery should be reduced for the benefit of both the domestic textile industry as well as export-oriented textile and garment manufacturing units, said Textile ministry sources.

The Confederation of Indian Textile Industry (CITI)—the apex body of textile industry—has already made a detailed presentation to the Textile Ministry seeking fiscal relief. It demanded reduction of excise duty on textile machinery on an average by 4 per cent while it has suggested complete abolition of Customs duty on import of textile machinery.

But the domestic manufacturers of textile machinery, who constitute a powerful lobby in the Confederation of Indian Industry (CII)—the apex body of capital goods manufacturers- are opposed to complete abolition of import duty on textile machinery.
In the face of spiralling rise in cotton prices the CITI is also demanding abolition of 4 per cent Excise and 5 per cent Customs Duty on Man Made Fibres (MMFs)—popularly known as synthetic yarn.

The CITI is of the view that in the face of rise in prices of cotton yarn the industry should be encouraged to use more and more of synthetic yarn through fiscal incentives.
DH News Service