\nEconomic Times, India
\n NEW DELHI: Exporters of textiles and garments may strike it lucky this month. While incentives given to exporters to fight the appreciating rupee stands to be withdrawn for all sectors this month-end, exporters of textiles and garments may be allowed to retain the benefits for a longer time.
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\nThe commerce department has prepared a Cabinet note pointing out that the sector facing stiff competition from its neighbours China and Pakistan needs to be hand-held for a longer time despite the sharp appreciation in the value of the dollar over the past few weeks. The Cabinet is expected to consider the proposal soon.<\/p>\n
Speaking to ET, government sources said that it was possible that the Cabinet would give its nod to the proposal to extend sops for the textiles sector. \u00e2\u20ac\u0153Textiles is one of the largest employment generating sectors. Last year, when mills were being forced to close down because of the appreciating rupee, hundreds lost their jobs. The government realises that textiles is a sector which has to be protected,\u00e2\u20ac\u009d an official said.<\/p>\n
Commerce & industry minister Kamal Nath wrote to prime minister Manmohan Singh last month urging him to intervene and ensure continuation of interest subvention of 4% for the textile sector facing stiff competition from neighbouring countries where exporters are being helped out by the governments. He wanted that the higher DEPB and duty drawback rates should also be not revoked.<\/p>\n
China has increased VAT refund given to synthetic and cotton producer to 13% against earlier rates of 9% and 11%, respectively. Pakistan, too, has introduced a 6% R&D assistance to its garment exporters which is now being extended to other segments of the textile sector.<\/p>\n
The finance ministry is, however, not impressed. \u00e2\u20ac\u0153We had urged the finance minister to allow the incentive package to be continued for the textiles sector. But he did not agree to the proposal. That is why we are now going to the Cabinet,\u00e2\u20ac\u009d the official said. Sources pointed out that the PM is sensitive to the needs of the sector and the chances of the Cabinet giving a nod to the extension proposal are bright.<\/p>\n
According to rough estimates made by the Confederation of Indian Textiles Industry, with demand slowing down in the Western market, India\u00e2\u20ac\u2122s exports this year could be lower than last year\u00e2\u20ac\u2122s $20.5 billion. India\u00e2\u20ac\u2122s exports to the US between January and June this year rose by a mere 1.7% instead of the average 15%-20% in the last few years.
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Economic Times, India NEW DELHI: Exporters of textiles and garments may strike it lucky this month. While incentives given to exporters to fight the appreciating rupee stands to be withdrawn for all sectors this month-end, exporters of textiles and garments may be allowed to retain the benefits for a longer time.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"yoast_head":"\n