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TEA appeals to mills for reducing yarn rates
Jul '08
Shri A Sakthivel
Shri A Sakthivel
The Central Government has conceded Mills Associations demands and announced zero duty on cotton imports yesterday (09.07.2008), thereby the basic customs duty of 10% and Special Additional Duty of 4% have been removed.

In addition, the Finance Ministry has also now withdrawn Duty Drawback benefit of 1% of FOB value of raw cotton exports.

Consequent to this announcement, unfortunately, an unexpected way, the Textile Mills have raised the yarn rates(10.7.2008) by Rs. 5/- for coarser counts.

In a Press Release issued, Shri. A. Sakthivel, President, TEA said that when the yarn prices have been hiked by about 25% in the past two months, the increase of yarn rates by Rs. 5/- by mills at this juncture is totally unjustifiable and added that the beleaguered exporters are neither in a position to pass on the increased cost to buyers nor absorb the cost.

Shri. A. Sakthivel mentioned that considering the crucial situation, the Textile Mills should reduce the yarn rates and follow win win approach for sustainability of Value added business.

Moreover, Shri. A. Sakthivel was under apprehension that in case, if the textile Mills are not considering the genuine appeal for reduction of yarn rates, then naturally, the garment exports will go out of the country and buyers will turn their attention to our main competing countries, China, Bangladesh, Pakistan, Vietnam and Cambodia.

Shri. A. Sakthivel finally appealed that in the larger interest of whole Textile Industry and our country's economy, the Textile Mills Associations should advise their members not to increase the yarn rates.


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