March 7 2011, Monday broke up as a whine- a Shoppers-Stop day in India, as around 10,000 apparel retailers observed 'bandh' remaining closed for the day. In tandem with various protest rallies by garment manufacturers and traders headed by Clothing Manufacturer Association of India (CMAI), the apparel retailers, members of Retail Association of India (RAI), kept their shops closed as a protest against recently announced mandatory 10% excise on all branded garments, by FM in his budget 2011-12.
Voicing his concerns the RAI CEO, Mr Kumar Rajagopalan in a talk with News team at fibre2fashion, reasoned that this obvious angst by garment industry players is justifiable as it is going be very difficult for the industry players to absorb the impact that this 10% increase on final price of garment is to cause on their customers, and threaten their businesses.
“Apparel retail in India is no less than of Rs.100, 000 crores, out of which the branded wear business stakes around 60,000 crores approx,” informed the CEO.
He informed further that predominant amount of business in the sector for the country is through branded retail, and this includes all kinds of small and big brands sold through small and big sized retailers. Many of these brands are made in a small space by as small as set of mere 25 workers, thus, not necessarily in the big factories earning sizeable profits.
Amplifying the agony of such manufacturers and others, Mr Rajagopalan avers “We hope the government would re-look on what they have done, for unlike others, this levy was to be applied immediately as the FM pronounced it; so immediately it came applicable on even 'Chhota-Mota Karkhana' (very small manufacturing units).”
The officer also informed that on an average the day to day business activities of select sector brings in around Rs 500 crores, and hence it is a big cost involved for such aversions both to country's economy and businesses as well. He is optimistic on policy makers' re-consideration on this decision of 10% excise, in the wake of such crucial movements in the industry.
Fibre2fashion News Desk - India
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