Economy

Garment makers' stir today

Our Bureaus Mumbai/Kolkata | Updated on March 03, 2011 Published on March 03, 2011

garments

The Clothing Manufacturers Association of India (CMAI) has planned a nation-wide protest against the 10 per cent excise duty imposed in the recent Budget on branded readymade garments.

About five lakh garment units spread across India will observe a one-day strike tomorrow. The All India Retailers will support the garment manufacturers by observing a bandh on Monday.

The garment makers have threatened to go on an indefinite strike if the Centre refuses to roll back the proposed duty.

Garment manufacturers in Mumbai met on Thursday and decided to take a morcha to Azad Maidan tomorrow. More than 10,000 people from the garment industry are expected to participate in the morcha.

Protest marches will also be undertaken in cities such as Ahmedabad, Ludhiana, Kolkata, Tirupur, Indore and Hyderabad.

In Bangalore, the garment manufacturers will gather near Gandhi Statue and offer flowers as a mark of peaceful protest, said Mr. Rahul Mehta, President, CMAI and Vice-Chairman of Asian Apparel Federation. Besides, a delegation from CMAI will submit a memorandum on their demand to the Finance Ministry and Textile Ministry in Delhi, he added.

“The garment industry is already paying a VAT (value added tax) of four per cent. So, the Government should remove the 10 per cent excise duty as there is no excise and VAT on fabric,” he added.

There is an optional excise duty on fabrics but a majority of fabric manufacturers do not pay the excise. As a result, garment manufacturers will not get Cenvat benefit in real sense, he said.

Branded garment industry is already suffering from 100 per cent increase in cotton prices in last one year; rising synthetic yarns used for blending and labour cost. The industry is struggling to pass on these cost increase to the consumers at the current inflationary situation, he said.

Rise in input costs following the increase in cotton and yarn prices have negatively impacted the industry already. The industry is currently operating at 50 per cent below capacity, Mr Sanjay Jain, Vice-President, Federation of Hosiery Manufacturers Association of India, said. Any further increase in price is likely to result in closure of several manufacturing units and unemployment for people, he added.

“Within a year, price of raw cotton fibre has gone up by 150 per cent and yarn prices by 100 per cent. Readymade garment price too has gone up by 50 per cent. Imposing excise would impact the consumers as well as several lakh people employed by the industry,” he added.

In West Bengal, the hosiery industry employs about two million people while across the country it employs over eight crore people.

The garment industry, which employs about 60 lakh people across the country, has an annual turnover of Rs 1.50 lakh crore of which exports account for Rs 50,000 crore.

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Published on March 03, 2011
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