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FICCI proposes fiscal corrections in Union Budget 2007-08
20 Feb '07
2 min read
As Union budget 2007-2008 is nearing, Federation of Indian Chambers of Commerce and Industry (FCCI) gave various suggestions and recommendations to Ministry of Textiles & Ministry of Chemicals & Petrochemicals for fiscal correction needed for synthetic textile sector.
According to FCCI, India is losing out in the fiercely competitive Asian market, wherein even countries like Bangladesh, Vietnam, Pakistan, Cambodia and Indonesia have all registered growth in the textile sector in the range of over 25 percent compared to the Indian scenario where growth has slowed down to less than 11 percent during January-September 2006.
The export of Cotton textiles from India is roughly 85 percent, whereas Synthetic textiles are only 15 percent. In contrast, the export of Synthetic textiles from China is around 60 percent. India has to catch up with China in increasing export in synthetic textile sector. Apparently, Synthetic Textile and Apparel sectors in India have not yet got the recognition due to them and urgent steps are required to be taken to give them their rightful share and proper attention for growth of these sectors, which is very critical in overall scheme of India's domestic market as well as exports.
Due to higher crude prices that have been prevailing in the recent past, the prices of fiber intermediates i.e. PX, PTA & MEG have been very high and unaffordable and with ten percent custom duty on PTA & MEG, there has been a very limited growth in this sector. The average growth in the polyester sector during the last five years has been a meager 4.5 percent per annum only.
Therefore, FICCI realized need to rationalize Custom and Excise duty structure in synthetic yarns & fiber sector.
In addition to these points, problem such as accumulation of CENVAT Credit due to creation of new capacities and National Calamity Contingency Duty were also mentioned in the suggestions given to Ministries.
Click to know more.
GET LATEST UPDATE ON UNION BUDGET 2007-2008
According to FCCI, India is losing out in the fiercely competitive Asian market, wherein even countries like Bangladesh, Vietnam, Pakistan, Cambodia and Indonesia have all registered growth in the textile sector in the range of over 25 percent compared to the Indian scenario where growth has slowed down to less than 11 percent during January-September 2006.
The export of Cotton textiles from India is roughly 85 percent, whereas Synthetic textiles are only 15 percent. In contrast, the export of Synthetic textiles from China is around 60 percent. India has to catch up with China in increasing export in synthetic textile sector. Apparently, Synthetic Textile and Apparel sectors in India have not yet got the recognition due to them and urgent steps are required to be taken to give them their rightful share and proper attention for growth of these sectors, which is very critical in overall scheme of India's domestic market as well as exports.
Due to higher crude prices that have been prevailing in the recent past, the prices of fiber intermediates i.e. PX, PTA & MEG have been very high and unaffordable and with ten percent custom duty on PTA & MEG, there has been a very limited growth in this sector. The average growth in the polyester sector during the last five years has been a meager 4.5 percent per annum only.
Therefore, FICCI realized need to rationalize Custom and Excise duty structure in synthetic yarns & fiber sector.
In addition to these points, problem such as accumulation of CENVAT Credit due to creation of new capacities and National Calamity Contingency Duty were also mentioned in the suggestions given to Ministries.
Click to know more.
GET LATEST UPDATE ON UNION BUDGET 2007-2008
Federation of Indian Chambers of Commerce and Industry
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