Mr Rakesh Vaid, President, Garments Exporters Association expressed serious concern at the reduction of Duty Drawback Rates for both knitted and woven garments from September 20, 2010, as it would have adverse impact on the export potential of readymade garments.
Mr.Vaid pointed out that the reduction in the duty drawback rates would have serious adverse consequences on the profitability of exporters who are already suffering from worldwide recession, low unit value realization from highly competitive overseas markets and steep hikes in cotton, yarn and fabric prices.
Mr.Vaid further pointed out that keeping in view the present export scenario, the Garment Exporters were expecting the Government would increase the rates or at least maintain at the present level. However, the Government has completely ignored the legitimate expectations and needs of the exporters and the cost data submitted by the Apparel Industry highlighting the justification for higher drawback rates for readymade garments.
The Garments Exporters have been recommending increase in duty drawback rates by increasing the scope and coverage of Drawback Scheme. The reduction in drawback rates has therefore shocked the garment export industry. Mr.Vaid has again requested the Government to restore the duty drawback rates as there is no justification for reduction in rates, in view of sharp increase in duties announced in the last Budget proposals on most of the inputs and materials used by garment exporters.
Garments Exporters Association
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