India : 'The Budget is very average' – GEA President

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Home / Knowledge / News / Textiles / 'The Budget is very average' – GEA President

'The Budget is very average' – GEA President

09
Jul '09

Mr. G. S. Madan, President Garment Exporters Association said that the Budget is very average which only ensures that the Garment sector of the textile industry keeps trailing along and has not provided anything substantial to give it an impetus which is so badly required in view of the worst crisis the garment export industry is facing in view of the global meltdown.

Mr. Madan pointed out that the Finance Minister has not given due consideration to various recommendations of the exporting community and the Ministry of Textiles to provide the necessary relief to the exporting community.

The Finance Minister has to appreciate the fact that the garment export sector requires special consideration in view of the fact it adds maximum value to the exported product using over 95 percent indigenous materials and extensively employing organized labour to create this value addition.

Another correlated fact which has to be given a lot of relevance is that 95 percent of the Garment Exporters belong to the MSME sector and in a wonderful democracy like ours he has to make provisions in the Budget which ignite the entrepreneur skills of these people and the export growth and employment generation would be an automatic by-product of this synergy.

Mr Madan gives here a few must do suggestions to achieve this synergy :
• Restoration of provisions of section 80 HHC of the Income Tax 1961 for a block period of next five years.
• Extension of service tax exemption to all export related services since the present provision of first depositing and then claiming refund only adds to the woes of the MSME sector exporters.
• A suitable Incentive scheme based on the intensity of organized labour employed. This would encourage promotion of the organized labour base in the Country which we so badly need.
• Interest rate subvention by the banks on export credit to be restored to 4 percent.
• The increase of excise duty from 4 percent to 8 percent on man-made fibers, filaments and their raw materials will make the garment exporters even more un competitive, so this should be reconsidered.

Garments Exporters Association

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