Pre-budget wish-list of captains of textile sector

23 Feb '10

7 min read

The excise duty on man made fibres had been increased from 4% to 8% in the last Union Budget and his suggestion is that, this duty on manmade fibres may be removed so that man-made fibres and cotton will have a level playing field and the consumption and utilization of man-made fibres can be increased. He also wanted Government to allocate gas for captive power plants of the textile industry and charge lower tariff on power cost.

Mr. Sunil Khandelwal, Chief Financial Officer of Alok Industries was thankful to the government as it has always been supportive to the textile industry due to its contribution to generation of employment (direct employment of about 35 million people) and exports totaling to US $21 billion and expects that positive support of the Government would continue.

Among his broad expectations from the ensuing budget are that custom duties will come down further on import of capital goods for expansion, which he says will help in importing the latest technology in weaving and processing, which is needed by the Indian textile sector as it will help reduce the overall cost of investment in plant and machinery.

With regards to excise duties, he expects excise duty on polyester to come down to 4% from present 8% and since, polyester being a fibre for masses, reduction in excise rates will make it more affordable to the consumer. He also looks forward to more allocation of funds for Textile Parks, etc, as they can provide integrated facilities and help the textile SMEs to withstand competition.

Among other fiscal measures, Mr Khandelwal, wants continuation of interest subvention of 2% on export working capital finance for another year till March 2011 as this will help in getting the required working capital funds for the industry at a reduced rate of interest and will help improve our competitiveness in international markets.

Just like Mr Akhil Jindal, he wants higher allocation of funds for reimbursement of TUFs interest subsidy, as a higher allocation of funds under TUFs Scheme will help in getting the subsidies on time, along with which he also wants a extension of TUFs for another five years till fiscal 2017, since many industry players have now started realizing textile growth opportunities, and therefore the much needed new investment can be attracted by extending the scheme, which in turn will further generate employment and increase India's share in the world textile trade.

Mr Alok Shah, Joint Managing Director, Garden Silk Mills Ltd hopes that the government continues the DEPB scheme for polyester chips and yarns as exports have been adversely affected by the global downturn and that, custom duties on polyester products be raised to partly counter severe undervaluation of the Chinese Yuan resulting in artificially cheap Chinese imports.

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