Manufacturing sector to see growth in April-June 2009

12 Mar '09

4 min read

FICCI has suggested the following additional measures to revive the growth in various manufacturing sectors : (a) Increase duty drawback rates for all Apparel items to 14% (b) Interest free loans for investment in machinery for temporary period (c) Availability of pre-shipment credit in foreign exchange (d) Reduce excise duty for leather & products from 8% to 6% (e) Remove FBT (Fringe Benefit Tax) on export promotion and travel (f) Abolish CST (Central Sales Tax) (g) Levy Safeguard and anti-dumping duties in certain sector like chemicals (h) Waive-off custom duty on raw materials that are not adequately available in the country for the manufacturing sector (j) Speedy implementation of infrastructure projects for which funds have been earmarked in two Stimulus Packages (sectors like machinery to benefit) (k) Reduce corporate tax rate by 5% (l) Increase credit availability for the sectors like textiles and leather(m) Even after refinance facility is available to financial institutions from SIDBI, SMEs are facing problem in getting credit. This needs to be looked into.

FICCI said that since the survey has assessed the impact of only first two Stimulus Packages and earlier announcement of rate cuts by RBI, it is quite likely that growth of the manufacturing sector could be stronger in the Quarter April-June 2009. The third Stimulus Package which was announced by the Government in last week of February and RBI announcement of more cuts in repo and reverse repo rates in early March may further push-up the demand and growth of the manufacturing sector noted FICCI.

Federation of Indian Chambers of Commerce and Industry

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