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Textile industry happy with extension of TUFS
Our Bureau
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Absence of deep cuts in excise duties worrying
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The Textiles Ministry had been pushing for extension of TUFS and had asked the Planning Commission to extend the scheme for another five years.
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Mumbai
Feb. 28
While the textile industry is happy with the Budget proposal to keep the Technology Upgradation Fund Scheme (TUFS) intact for another five years, it is upset over the absence of deep cuts in excise duties.
"The Central excise, which was 8 per cent on manmade fabrics, was expected to be reduced to 4 per cent to be on par with cotton," said Mr Rajendra J. Hinduja, Executive Director, Finance, Gokaldas Exports Ltd.
"We welcome the continuation of the TUF Scheme as well as the reduction in import duty for polyester fibre and yarn. However, we also expected the excise duty on polyester to be brought down," said Mr R.L. Toshniwal, Chairman and Managing Director, Banswara Syntex Ltd.
The Textiles Ministry had been pushing for extension of TUFS and had asked the Planning Commission to extend the scheme for another five years. Another positive is that the handloom sector has been brought under the scheme. The Budget has allocated Rs 911 crore to the fund for 2007-08 against Rs 535 crore last year.
"The industry's growth will be faster with the extension of the TUF scheme. Funds disbursements will also be faster," said Mr Dilip Jiwrajka, Managing Director, Alok Industries.
"The Budget duty cuts on raw materials like purified terephthalic acid (PTA) and polyester fibres are a positive. However, the excise duty on raw monoethylene glycol (MEG) and caprolactum still remains at 12.5 per cent. We expected the Finance Minister to address this, which has not happened," said Mr Sunil Gupta, Director, Gupta Synthetics. Mr Chidambaram has reduced the customs duty on raw materials such as PTA and MEG from 10 per cent to 7.5 per cent.
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