Pre-budget memo for textile industry

SURAT: For the manmade fibre-based textile industry, which constitutes 20 per cent of industrial production, nine per cent of revenue from excise duties, 30 per cent of total export earnings and provides 18 per cent of the total workforce in the country, growth is possible only if certain changes take place. These changes include uniform rate of excise duty from yarns to ready-made garments, removal of additional excise duty, exemption to hand-processing units from sourcing and hydro-extraction, reduction in custom duty on yarns and fibres, and import of textile machinery.As part of pre-budget memorandum, the Federation of Indian Art Silk Weaving Industry (FIASWI) has urged the central ministry of finance to consider several issues pertaining to manmade fibres, filament yarns and fabric industry in the country. FIASWI chairman Arun Jariwala in the memorandum has said that the industry, which provides direct employment to over 38 million people, next only to agriculture sector in the country, should be provided reduction in costs, alongwith improvement in product portfolio. With comprehensive marketing policies and enhanced business efficiency, the textile industry, which has been facing diminishing profitability, should be given the required impetus so that the potential for increased domestic consumption should be exploited, Jariwala said in the memorandum. On the issue of power tariff for the industry, the memorandum pointed that power tariff varies not only from state to state, but also within the state. According to Jariwala, at the policy level, distortions in fiscal regime have led to unhealthy competition, based on tax and duty evasions, and exemptions. In the case of manmade filament yarns, the excise duty on partially oriented yarn (POY)is 36.80 per cent, whereas on other yarns it is only 18.40 per cent.