Mumbai, 23 Feb 2011
The textile industry has sought measures to boost exports of
apparels and textile products in a cost-competitive market and
easier access to funds for cotton buyers as it peaks in a year
of global shortage.
The Confederation of Indian Textile Industry (CITI) has also
sought the restoration of drawback rates as "our textile
products are facing tough competition in global markets."
"There is an opportunity for taking up market share because
costs in China have risen considerably and buyers are shifting
some of the sourcing to other parts," said Devangshu Dutta,
chief executive, Third Eyesight, a textile consultancy.
"We should be looking at encouraging conversion of raw
material within the country. Far too much export is weighted towards
raw material and intermediate products," he added.
The government has restricted exports of cotton yarn at 720 million
kg for 2010/11 season that began on Oct. 1.
India's apparel exports volume may crimp by at least 15 percent
in FY11 as sky-rocketing cotton prices shrivel demand.
U.S. cotton futures early this month rallied to a record high
of $2.1102 per lb. While cotton prices in India are still near
a record high touched on Feb 10.
One export sop would be the re-introduction of Section 80 HCC,
which exempt income from exports, Manish Mandhana, managing director
of Mandhana Industries, said.
"Boosting the cost competitiveness of Indian products in
the U.S. and EU markets" is what the industry needs, he added.
CITI also wants that working capital for cotton purchase to textile
mills be given at lower margins, cheaper rates and a longer credit-period.
"Given that the situation is not very good because of cotton
prices," said R.K. Dalmia, president, Century Textiles, "They
should have a sympathetic view of the industry."
CITI wants the government to abolish duties on all machinery
for textile and clothing industry until domestic industry is able
to supply products of global standards.
It also wants more allocation under the Technology Upgradation
Fund Scheme (TUFS) for FY11 and FY12 in order to avoid delay in
TUFS, under which textile units can avail loans at concessional
rates, has been suspended as funds earmarked for the eleventh
plan period has been already been utilised in the first three
(Editing by Harish Nambiar)