To offset the absence of a level playing field due to higher rates of duties for Indian textile products in various major international markets, higher raw material cost, high cost of funding and high transaction cost, Southern India Mills’ Association (SIMA) has urged the Central Government to come out with a policy to strengthen the competitiveness of the Indian textile industry. At a press meet, T Rajkumar, Chairman, SIMA stated that taking advantage of the surplus cotton, spinning capacity, fabric production capacity could be converted into a significant amount of foreign exchange which could greatly help the Government to overcome the balance of payment issue.
SIMA Chairman further highlighted that Vietnam and Cambodia have zero duty access and Pakistan has zero duty access for fabrics and 5 per cent duty for apparels and made-ups in China while the Indian yarn attracts 3.5 per cent duty, fabric attracts 8.5 per cent duty and made-up and apparels attract 14 per cent duty. He appealed to the Centre to expedite FTAs with China, EU and other countries on a war footing and create a level playing field to enable India to grab the opportunities emerging in these countries particularly China which had already started cutting down its production.
Rajkumar has urged the Prime Minister to extend 3 to 5 per cent incentive under Merchant Export Incentivization Scheme (MEIS) as an interim relief till the FTAs are signed to enable the Indian textile industry to compete in the global market and fully utilize the production capacity.