Recommendations

Immediate:

1. Immediate ad hoc increases in all industry Duty draw back rates by at least 2%.
2. 2% additional subvention in export credit
3. Exemption of fringe benefit tax as applicable to IT sector may be extended to apparel export sector
4. 80 HHC benefit should be re-introduced for at least 5 years
5. Interest free loans for investment in machinery should be introduced along with zero duty import of capital goods scheme.

Short term:

1. Moratorium of two years for repayment of principal amount against term loan
2. A part of funds under rural employment guarantee scheme be earmarked for apparel sector, since absorbs agriculture labour.

Long term:

1. Benefits available in SEZ are extended, at par to units in domestic tariff area, if exports are at least 90% manufacturing.
2. Higher allocation of funds to apparel export industry for capacity building
3. Rs.250 Crore allocations for brand building exercise.

If recommendations are accepted

• Over 71% employment generation is in garment sector
• Aims at 75% achievement in textile ministry's target for new jobs of 8 million by 2012
• Direct employment generation in garmenting will be 3.34 million
• Weaving, knitting and processing will be 1.14 million
• Spinning 0.2 million
• Indirect employment generation will be 6.05 million.

Source: AEPC Weekly