Shri P.D. Patodia, Chairman, CITI has stated that the textile Industry is disturbed to see that Government has reduced DEPB rates on exports of yarn from 5% to 3%. The entire textile and clothing industry is going through a grave crisis and for the first time in several decades, our exports have started registering substantial negative growth.
Shri Patodia pointed out that the steep appreciation of Rupee and the increasing interest rate are the major reasons for the decline in exports. In April 2007, exports of textiles and clothing registered a negative growth of 18.23%, compared to April 2006.
Shri Patodia stated that textile and clothing industry of India suffered several handicaps in achieving export growth. Areas like infrastructure, labour laws, transaction cost, etc., would need long-term action plans for improvement. The quickest and most effective remedial measure that Government could take to prevent collapse of our exports is to ensure that all duties on exported products are reimbursed in full to exporters.
Referring to Government's export sops, Chairman, CITI pointed out that the Package announced recently by Minister of Commerce & Industry for exports, stated that Drawback / DEPB rates would be increased by 5%. However, they were actually increased only by 2 to 3%.
With the current reduction from 5% to 3%, the DEPB rate for yarn has actually gone up only by 1%. Such frequent changes in rates of duty reimbursements not only make export uncompetitive but also create uncertainties in price negotiation, since the rates announced by Government can change at any time without notice. Such uncertainties can only aggravate the crisis that our exporters are currently facing, added Shri Patodia.
Chairman, CITI requested Government to immediately restore the DEPB rate of 5% for all the textile products on which these have now been reduced to 3% and also to ensure that any reduction in export incentives, including Drawback and DEPB rates is implemented only with a minimum notice period of three months so that contracts already entered into by the industry can be implemented on the basis of the rates prevailing at the time of price negotiations.
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Taiwan Textile Federation (TTF)")
