Financial Daily from THE HINDU group of publications
Tuesday, Oct 07, 2003
Financial Daily from THE HINDU group of publications Tuesday, Oct 07, 2003 |
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Industry & Economy
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Textiles EU charges on bed linen exports — Govt, Texprocil likely to submit reply by Oct 10 Anna Peter
Mumbai , Oct. 6 THE Union Government, along with Texprocil, is likely to submit its reply to the European Union by October 10 against the European Commission's charges of subsidies on Indian cotton bed linen exported to EU countries. Recently, the European Commission (EC) released a disclosure document on its findings regarding Indian cotton bed linen exports. According to Mr Siddhartha Rajagopal, Executive Director, Texprocil (The Cotton Textiles Export Promotion Council), the parties involved would have to file a reply by October 10. The Government, Texprocil and export companies would have to explain their positions on the charges. According to an expert, the EC is arguing that the Union Government provides Indian exporters subsidies through schemes such as the DEPB (Duty Entitlement Passbook), DFRC (Duty Free Replenishment Certificate) and the Section 80 HHC of the Income-Tax Act. However, Indian exporters said that the DEPB scheme is purely a customs refund. They added that the numerous transaction costs are incurred in the course of the dealings and that the Government had to rationalise some taxes. Currently, EU importers have to pay a duty of 9.6 per cent on Indian bed linen. This could rise substantially if the EC rules against Indian exporters. The EC feels that Indian bed linen exports are harming its domestic industry and the `subsidies' are partly to blame. The additional duties would harm Indian exports. There is, however, a growing belief among exporters that the EC and the US are targeting various export promotion schemes across the production chain in developing countries such as India as prohibited subsidies to inhibit textile imports in the quota-free regime starting in 2005. According to figures quoted by Mr Lalit Desai, Chairman, Texprocil, at its recent AGM, during the EC's Partial Interim Review and Expiry Review, India's share of imports into the EU declined to 9.7 per cent in 2002 from 16 per cent in 1997. In value terms, it declined to 8.1 per cent from 14.7 per cent in the same period. He added that the trends in investigations were sending disturbing signals.
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