Amongst its main demands, the Southern India Mills Association (SIMA) has suggested exclusion of the spinning sector from the purview of TUF Scheme, considering the under utilization of existing spinning capacity and mismatch in the supply-demand.
It has also requested removal of 5% customs duty and 4% special additional duty and reduce the 10% central excise duty on manmade fibre to 4% with optional route on par with cotton textiles in its pre-budget recommendations put up before the Finance Ministry.
SIMA has also requested the Ministry to extend the restructured TUFs for the entire 12th five year plan period. It also asked that the Ministry to provide benefits for the black out period between June 29, 2010 and April 27, 2011, when the TUF was suspended and suggested that this period could be considered in the old format.
In the new TUFs, only shuttle-less looms have been given 10% capital subsidy. However, since the main weakness in weaving sector stems from lack of investment in modern weaving preparatory machines, it has suggested that capital subsidy be extended to weaving preparatory machines also.
It has suggested that manufacturer and exporters of yarn be permitted to fulfill the export obligation fixed under EPCG scheme by exporting fabric and garment as well (value added products) which would encourage vertical integration.
Since the export of cotton yarn had been banned during 2010-11, it has recommended that spinning mills should be exempted from the obligation and average to be fulfilled for the financial year 2010-11.
Among other demands, it has demanded that the excise duty on automatic looms and projectile shuttle-less looms should be withdrawn to encourage technology up-gradation in this sector.
SIMA has also sought exemption from mandatory cost audit for textile mills, since the details sought during the audit is available in the documents filed under the Companies Act.
Fibre2fashion News Desk - India
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