Home / Knowledge / News / Apparel/Garments / 'Open up non-food retail to FDI' – CMAI tells govt
'Open up non-food retail to FDI' – CMAI tells govt
21
Feb '12
Among its various pre-budget recommendations to the Finance Ministry, the Clothing Manufacturers Association of India (CMAI) has proposed opening up the non-food sector to foreign direct investment (FDI), removal of excise duty on branded garments and ban on imports of second-hand clothing.

The Indian domestic textile and garment industry is estimated at Rs. 1,500 billion and has grown at an annualized rate of 14 percent since 2007, providing direct employment to about 6 million people. Majority of the industry and market is unorganized, characterized by family-run businesses with small capacities and limited reach.

But after the removal of SSI restriction in 2003, organised sector share has grown to about 27% or about Rs. 400 billion, driven largely by the penetration of organised retail.

High degree of growth is expected on account of rising disposable incomes, growing consumer class and advent of global brands in the Indian markets which would increase the level of consumption. The domestic market size is expected to reach Rs. 3,000 billion by 2017 creating a direct employment opportunity for more than 7 million people.

With a view to promote the Indian textile and garment sector and provide impetus to its growth prospects, the CMAI has forwarded several recommendations to the finance ministry to be included in the budget for fiscal year 2012-13.

1) Removal of excise duty on branded garments:
The 10 percent excise duty imposed on the garment industry has been untimely as the Industry is already suffering due to macro-economic factors like inflation and borrowing costs; and industry specific factors like rising raw material costs and labour costs. Imposition of 10% excise duty on branded garments means reduction of already wafer-thin margins of the industry players.

To ensure the industry again grows at a fast pace and consumption is increased, the excise duty has to be removed immediately and if excise duty cannot be removed because of future GST roll out, than it should be reduced to 1 percent in line with 130 other items.

2) Deduction of R&D expenses including sampling costs:
Being a fashion oriented sector with trends changing at such a fast pace, considerable sums of money are required for the development of new products and designs and also on account of sampling. Sampling expenses which form a significant proportion of the product development cost are currently not under the purview of R&D expenses.

With a view to encourage the garment industry, benefits under this section should be extended beyond March 2012. Sampling costs should also be considered as part of R&D expenses and allow for necessary deduction for the same. This deduction should also be extended to unorganised units in SSI sector along with companies.

3) Funding for Development of Domestic Market:
India is a large country with several heterogeneous population groups, due to which one size/fit is not suitable across the board. Providing right size and fit to the market will promote the consumption of ready-to-wear and expedite the shift from ready-to-stitch.


Must ReadView All

Indian govt approves special package for leather, footwear

Textiles | On 16th Dec 2017

Indian govt approves special package for leather, footwear

The Union Cabinet chaired by PM Narendra Modi has approved a special...

EU parliament resolution calls for Cambodia sanctions

Apparel/Garments | On 16th Dec 2017

EU parliament resolution calls for Cambodia sanctions

Following the ongoing crackdown in Cambodia on the opposition and...

Affordable prices to be hit if US pulls out of NAFTA: NRF

Apparel/Garments | On 16th Dec 2017

Affordable prices to be hit if US pulls out of NAFTA: NRF

US retailers’ ability to offer consumers quality products at...

Interviews View All

Manfred Mentges
Sedo Treepoint GmbH

We see a higher demand in colour management systems, as customers see big...

Deepak Jain
Baggout

We are using Facebook and Instagram to promote ourselves

Jurgen Gauger
Spreadshirt

‘Buying crowdsourced or creative designs are much more appealing to the...

Abhishek Pachauri

Reckon Industries adapts latest systems for manufacturing from designing...

Nitesh Mittal

Kusumgar Corporates is a leading manufacturer of technical textiles and...

Sugandha Bhardwaj

<div>New Delhi-based Brinjal Designs Pvt Ltd manufactures home furnishing...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Mark Paterson
Technical Absorbents Ltd

Mark Paterson, R&D manager of Technical Absorbents Ltd talks about Super...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Nisha Chanda
Whistling Woods International School of Fashion

<div>A lack of upgraded courses in costume designing and fashion as per...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

December 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
69.6%
No
12.0%
Skip
18.5%

Total Votes: 92

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
62.0%
No
30.4%
Skip
7.6%

Total Votes: 92

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.0%
No
9.8%
Skip
3.3%

Total Votes: 92

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
81.5%
No
8.7%
Skip
9.8%

Total Votes: 92


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search