India's textiles exports to US fall by 14 per cent
With India's textile exports to US falling by around 14 per cent, FICCI submitted its comprehensive agenda for the textile sector to the minister, in which the industry body has emphasised the need for scaling-up the skill development initiatives
WITH INDIA'S textile exports to US falling by around 14 per cent in the first four months of 2009, a FICCI delegation led by its president, Harsh Pati Singhania met the Union Minister of Textiles Dayanidhi Maran to explain him the seriousness of the crisis in the sector on Thursday.
FICCI submitted its comprehensive agenda for the textile sector to the minister, in which the industry body has emphasised the need for scaling-up the skill development initiatives in the textiles and garment sector.
It also called for increasing Duty Drawback rates for the textiles sector by at least 5 per cent to ensure that all duties (including local taxes) are reimbursed to the exporters. FICCI said that textiles, which is the second largest employment generating sector in the country after agriculture, would require Mission Mode approach at a large scale to absorb 10 million people in the next five years.
Hence, government’s skill development programmes need to be scaled-up to train at least two million people in a year. In view of the weak demand in traditional markets like US and EU, FICCI suggested that government should provide 100 per cent risk coverage through cheaper Export Credit Guarantee Corporation (ECGC) for exports to other countries like Latin America, Middle East etc.
FICCI further requested the government not to consider any hike in Minimum Support Price (MSP) of cotton in the coming season and also expressed the immediate need for formulating comprehensive National Fibre Policy.
Some other suggestions given by FICCI were to restore temporarily (at least for next 2 to 3 years) 100 per cent exemption of export earnings under Section 80HHC of Income Tax Act and provide export credit at 7 per cent (the rate at which agricultural loans are given) till 2010.
Also, FICCI said that in view of the tough competition in the shrinking markets abroad, Fringe Benefit Tax (FBT) on marketing initiatives and travel abroad should be withdrawn as exporters need to travel more frequently to their buyers under current circumstances. Government should make adequate allocation of funds under TUFS and ensure speedy clearances.
It also called for increasing Duty Drawback rates for the textiles sector by at least 5 per cent to ensure that all duties (including local taxes) are reimbursed to the exporters. FICCI said that textiles, which is the second largest employment generating sector in the country after agriculture, would require Mission Mode approach at a large scale to absorb 10 million people in the next five years.
Hence, government’s skill development programmes need to be scaled-up to train at least two million people in a year. In view of the weak demand in traditional markets like US and EU, FICCI suggested that government should provide 100 per cent risk coverage through cheaper Export Credit Guarantee Corporation (ECGC) for exports to other countries like Latin America, Middle East etc.
FICCI further requested the government not to consider any hike in Minimum Support Price (MSP) of cotton in the coming season and also expressed the immediate need for formulating comprehensive National Fibre Policy.
Some other suggestions given by FICCI were to restore temporarily (at least for next 2 to 3 years) 100 per cent exemption of export earnings under Section 80HHC of Income Tax Act and provide export credit at 7 per cent (the rate at which agricultural loans are given) till 2010.
Also, FICCI said that in view of the tough competition in the shrinking markets abroad, Fringe Benefit Tax (FBT) on marketing initiatives and travel abroad should be withdrawn as exporters need to travel more frequently to their buyers under current circumstances. Government should make adequate allocation of funds under TUFS and ensure speedy clearances.
The textile sector is crying for the help, since long.The texile units are small and have outdated machinery. With the result, these units canot compete with low cost producing country like Bangladesh and high end producing country like China.I hope the Govt. shall give this sector due prority and in return generate lot of emloyment ,which is the need of the hour.
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