Lukewarm response to textile package

Lukewarm response to textile package

Tamil Nadu textile industry has reacted positively to the increase in budgetary allocation to the sector at Rs 7,140 crore but insists that concerns over pending funds under various schemes and erosion of pre-GST incentives still hurt the industry.

Tamil Nadu textile industry has reacted positively to the increase in budgetary allocation to the sector at Rs 7,140 crore but insists that concerns over pending funds under various schemes and erosion of pre-GST incentives still hurt the industry. Finance Minister Arun Jaitley in his Budget speech allocated the sum for the industry comprising yarn spinners, fabric and garment manufacturers and exporters.

Raja Shanmugam, President of Tirupur Exporters Association, the Western Tamil Nadu based cluster turning over tens of thousands of rupees in exports and domestic sales, said the Budget announcement was "not so pleasing" as it was a just bump up in allocations compared to the previous one. The expectation from the industry was that the Government will spell out reforms to compensate for duty drawback and sops under the Rebate on State Levies scheme (ROSL).

“Since the GST regime does not have these invisible sops, our competitiveness was hit. We hoped the finance Minister would touch upon the subject,” he told. Entrepreneurs had got about 2.5 per cent of duty refunds after a small change was effected to the MEIS and ROSL schemes recently, but the advantage was 5-6 per cent of refunds under the VAT system.

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