Indian cotton textile industry calls on government to take emergency measures
The Confederation of Indian Textile Industry (CITI) said that the Indian government should take emergency measures to quell the crisis that has severely hit the Indian textile industry.
CITI Chairman Shishir Jaipuria said that the Indian cotton spinning industry has suffered an estimated setback due to the unprecedented serious derailment that has led to a sharp fall in cotton yarn prices, a sharp drop in demand, the withdrawal of export incentives, the imposition of new goods taxes, and arbitrary restrictions on cotton yarn exports. Huge losses amounting to INR 110 billion (USD 2.5 billion).
CITI pointed out that unless the Indian government announces relevant relief packages, these losses will cause a series of textile factories to close down in recent months.
The chairman of Jaipuria revealed that the relief package should include the immediate restoration and retroactive “DutyEntitlement PassBook, DEPB” export incentives and export cotton yarn exemption tax, as well as the restoration of 4.5% interest subsidy for exported textile and garment products.
Chairman Jaipuria also added that the 10% excise tax on ready-made clothing and designer goods passed in the last government budget should be removed, and textile and ready-made garment companies should be required to repay all loans and interest – including the Technology Upgradation Fund Scheme (Technology Upgradation Fund Scheme, TUFS) loan requirements shall be extended for 2 years.
CITI’s appeal is due to the fact that the domestic cotton price in India soared from 30,000 rupees per candy (about 227 kilograms) in September last year to 63,000 rupees in February/March this year, but fell to 45,000 rupees in April. The rupee even fell back to 38,000 rupees in June, triggered by significant price fluctuations.
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