Clear ₹3,000 cr dues under TUFS: Texprocil tells Govt

Our Bureau Mumbai | Updated on November 29, 2018 Published on November 29, 2018

The margins in the textile industry, which are already low, have made this reduction commercially unviable in many cases   -  Prashant Waydande

‘Higher duties on Indian textiles in global market need to be addressed’

The Cotton Textiles Export Promotion Council (Texprocil) has urged the government to disburse the committed support of about ₹3,000 crore under Textile Upgradation Fund Scheme to help the industry tide over tough times.

Addressing the 64th Annual General Meeting, Ujwal Lahoti, Chairman, Texprocil, said the textile industry has been under severe stress since April 2014 due to the non-disbursal of committed liabilities under TUFS scheme.

Several hundred mills, especially spinning mills, are facing closure and they are likely to become NPAs. An estimated ₹3,000-crore dues towards committed liabilities remain unpaid under technology upgradation scheme for the textile industry, he said.

“We, therefore, need to urgently disburse the committed liabilities under TUFS scheme,” he added.

Cotton yarn in MEIS

The Council has asked the government to include cotton yarn under Merchandise Exports from India Scheme (MEIS) as it is the only product that has been deprived of export incentives despite lot of value-addition within the country, while there is a strong case to double MEIS on fabrics to four per cent.

Besides, he urged including cotton yarn and fabrics under the ROSL (Rebate of State Levies) scheme as it faces many State levies as in the case of made-ups and garments. The central levies should also be factored under the ROSL as these levies are not being considered in duty drawback, he said.

Interest subvention should also be extended to merchant exporters as they contribute substantially to exports, said Lahoti.

Higher levies

The discriminatory duties on Indian textile exports in key markets such as EU, China and South Korea needs to be addressed. The duties range from 3.5 per cent to 8 per cent for fabrics and 9.6 per cent on made-ups in the EU. On the other hand, imports from competing nations such as Bangladesh, Cambodia, Vietnam, Pakistan and Turkey are considered duty-free in these markets. Lahoti said exporters of cotton textiles face internal challenges such as high interest rates, volatility of cotton prices and high logistics costs. The steep reduction in export benefits is another issue faced by exporters.

The margins in the textile industry, which are already low, have made this reduction commercially unviable in many cases. This has resulted in the Indian cotton textiles products becoming much costlier than those of competing nations, he added.

New chairman

Texprocil has appointed KV Srinivasan, Managing Director, Sree Narasimha Textiles, Premier Mills and Premier Fine Linens, as its new Chairman. He is a committee member of The Cotton Textiles Export Promotion Council from 1998.

He completed his BTech in Textile Technology from PSG College of Technology in 1983 and MSc in Textile Technology in December 1984 from the University of Manchester. He is the Chairman of the South Indian Textile Research Association, Coimbatore.

Published on November 29, 2018
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