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Synthetic textiles sector wants excise duty scrapped
08
Jun '15
The synthetic textiles industry has appealed to the textiles ministry for a complete recast of excise and customs regime to be able to compete with Bangladesh, China and Vietnam and not lose out on the "Make in India" campaign.

"A poor man wearing synthetic shirt of Rs 200 bears highest excise and tax burden, whereas a rich man wearing cotton shirt of Rs 1,000 bears no excise or taxes," said Anil Rajvanshi, chairman of the synthetic and rayon textiles export promotion council (SRTEPC).

"This has fragmented and weakened the industry. You have to save this industry or else we will not be able to sustain and give way to countries like China, Vietnam and Bangladesh to march past India," Rajvanshi wrote in a letter to textiles minister Santosh Kumar Gangwar.

The letter said imports of to Rs 5,000 crore in between April 2013 and February this year had depressed market of several man-made fibers. In addition to the $825 million worth of import of fibres, filament and spun yarn, fabric imports topped $780 million in 2014-15.

"The high excise duty makes domestic produce expensive and imports cheaper," the letter added.

It said India imported 12.5 million pieces of garments from Bangladesh, which could be valued at around Rs 12,000 crore. "All these are synthetic as cotton imports and those of cotton yarn and cotton fabrics are negligible."

The excise duty, the council said, is unfair discrimination between cotton and synthetic fibre and is distorting the textile market in favour of cotton, which is the opposite of the global trend.

The letter said the world over the consumption of man-made textiles is 70 per cent and that of cotton is 30 per cent. But in India, it is the due to fiscal anomaly, the synthetics face a 12.5-per cent excise duty while cotton and its downstreams have no duties and taxes. (SH)

Fibre2fashion News Desk – India

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