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Our Bureau

Coimbatore , Jan. 24

THE Southern India Mills Association (SIMA) has lamented the downward revision in the export incentive schemes such as the DEPB and the duty drawback in quick succession and said the changes would cause a setback to textile exports.

The ad hoc tinkering with the export promotion schemes in the mid-season by the Government, whatever may be its long-term objective, was not justified especially when the national foreign trade policy 2005 was round the corner. The lack of transparency in framing policies would not augur well for the textile industry, said the Association.

The SIMA Chairman, Mr Vijay Venkataswamy, in a statement maintained that even while major buyers of Indian textiles were seeking 10 per cent to 15 per cent cut in price, the downward revision in duty drawback rates and the DEPB would squeeze the exporters' margins and bear on their future investment plans.

As for cotton textile sector, the revision had led to a reduced drawback rate ranging between 24 per cent and 47 per cent in the case of fabrics and 64 per cent and 71 per cent in the case of made-up items.

The drawback rates for textile items were slashed following the introduction of excise exemption route in the last Budget but many State-level taxes were not taken into account while evolving the revised drawback rates.

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