CITI seeks excise duty reduction on all man-made fibres

06 Dec '14

3 min read

CITI requested that an additional allocation of Rs 3,000 crore may be included in the Budget for 2015-16 to provide Technology Upgradation Fund Scheme (TUFS) benefits to two kinds of cases. “One is where banks have committed mistakes either in not reporting or in wrongly reporting loan details to the Ministry of Textiles. The other kind of cases relates to the period 29 June 2010 – 27 April 2011 during which the scheme was in operation but sanctioning of fresh loans remained suspended. After a review, sanctioning of fresh loans was reintroduced prospectively and therefore the period during which the review took place, generally referred to as blackout period, remained uncovered.”

For stabilising cotton prices, CITI has suggested that measures need to be taken to enable textile mills to buy and stock more cotton. It recommended that (a) Interest rate for working capital for purchase of cotton may be reduced to 7 per cent from the current 12 per cent, as a one-time measure for the current cotton year ending September 2015; (b) Margin money for purchase of cotton may be reduced to 10 per cent from the current 20-25 per cent; and (c) Working capital for purchase of cotton may be made available to cover 5-6 months’ cotton requirements of the mills instead of 2-3 months’ requirement currently being financed by the banks. (RKS)

Fibre2fashion News Desk - India

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