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State levies hampering fabric exports: Texprocil

Our Bureau Mumbai | Updated on January 09, 2018

Textile Export Promotion Council has urged the government to increase the reimbursement limit of State levies on fabric exports from the current level of 5 per cent.

Welcoming the government’s new initiative SAATHI (Sustainable and Accelerated Adoption of efficient Textile technologies to Help small Industries), Texprocil chairman Ujwal Lahoti said the government should look into the industry’s demand for extending the ROSL (Refund of State Levies) benefit of above 5 per cent to the fabric sector, so that only the product gets exported and not the embedded taxes.

SAATHI is expected to benefit some 25 lakh powerloom units, which produce 57 per cent of the total cloth in the country. The use of efficient equipment would result in energy and cost savings to the unit owner who would, in turn, repay in instalments to EESL (Energy Efficient Services Limited) over four-five years.

He said the initiative is a step in the right direction as there is enormous scope for increasing production and exports of fabrics due to abundant availability of raw materials and technical skills. Fabric exports can be increased substantially if they are treated on a par with garments and made-ups in terms of incentives, he added.

Fabric production has dropped four per cent despite the weaving capacity increasing 12 per cent over the last seven years. The fall in exports has been largely due to India becoming uncompetitive in global markets with the various added costs, non-refund of State levies and the duty-free access competing countries such as Pakistan, Bangladesh, and Vietnam have to the EU market, he said.

Published on October 30, 2017

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