Textile industry seeks cut in duties and higher funds allocation for growth

Textile industry are seeking reduction in excise and import duties while pitching for higher fund allocation as it will enable Indian textile industry to achieve a substantial growth rate in the market of man-made textile products as this segment has not achieved any growth rate over a period. In this regard, South Indian Mills Association (SIMA) representatives met Textile Minister Santosh Gangwar.

According to SIMA Chairmen T Rajkumar, it is essential to reduce the central excise duty on man-made fibre from 12 percent to 6 percent on par with cotton and also remove the 5 percent import duty and 4 percent special additional duty. The industry also want the government to allocate funds of Rs 3,500 crore for the ongoing Technology Upgradation Funds scheme (TUFS) to meet the liabilities of the last three quarters of 2014-15 and also for the entire period of 2015-16.

The Union Budget has allocated only Rs 1,520 crore which may not meet the fund requirement for even 2014-15.

The industry had also demanded an allocation of Rs 3,000 crore to meet the pending cases under TUF scheme including committed liability, left out cases and blackout period with effect from 1st April 2007. This is to sustain financial viability of around Rs 65,000 crore investments already made by the industry.

The industry has also demanded 5 percent interest subvention, reduction of margin money from 25 per cent to 10 percent and increase the credit limit from 3 months to 9 months for the cotton working capital to bring stability in cotton prices. This would enhance the growth rate of cotton textile industry by 3 to 5 percent and also ensure fair prices for the cotton farmers.

Yesterday, Rajkumar had a meeting with Gangwar in this regard; the Textile Minister has promised to take up the matter with the Ministry of Finance and ensured to allot adequate funds in due course.