NEW DELHI: Exporters of textiles and garments may strike it lucky this month. While incentives given to exporters to fight the appreciating rupee stands to be withdrawn for all sectors this month-end, exporters of textiles and garments may be allowed to retain the benefits for a longer time.
The commerce department has prepared a Cabinet note pointing out that the sector facing stiff competition from its neighbours China and Pakistan needs to be hand-held for a longer time despite the sharp appreciation in the value of the dollar over the past few weeks. The Cabinet is expected to consider the proposal soon. Speaking to ET, government sources said that it was possible that the Cabinet would give its nod to the proposal to extend sops for the textiles sector. "Textiles is one of the largest employment generating sectors. Last year, when mills were being forced to close down because of the appreciating rupee, hundreds lost their jobs. The government realises that textiles is a sector which has to be protected," an official said. Commerce & industry minister Kamal Nath wrote to prime minister Manmohan Singh last month urging him to intervene and ensure continuation of interest subvention of 4% for the textile sector facing stiff competition from neighbouring countries where exporters are being helped out by the governments. He wanted that the higher DEPB and duty drawback rates should also be not revoked. China has increased VAT refund given to synthetic and cotton producer to 13% against earlier rates of 9% and 11%, respectively. Pakistan, too, has introduced a 6% R&D assistance to its garment exporters which is now being extended to other segments of the textile sector. The finance ministry is, however, not impressed. "We had urged the finance minister to allow the incentive package to be continued for the textiles sector. But he did not agree to the proposal. That is why we are now going to the Cabinet," the official said. Sources pointed out that the PM is sensitive to the needs of the sector and the chances of the Cabinet giving a nod to the extension proposal are bright. According to rough estimates made by the Confederation of Indian Textiles Industry, with demand slowing down in the Western market, India's exports this year could be lower than last year's $20.5 billion. India's exports to the US between January and June this year rose by a mere 1.7% instead of the average 15%-20% in the last few years. var RN = new String (Math.random()); var RNS = RN.substring (2,11); b2 = ' '; if (doweshowbellyad==1) bellyad.innerHTML = b2; http://economictimes.indiatimes.com/News/Economy/Centre_may_extend_sops_to_garment_textile_exporters/articleshow/3483415.cms Experience is the teacher of all things. - Julius Caesar -- Posted By Ronald Chisley to Investor Forums at 9/15/2008 08:06:00 AM --~--~---------~--~----~------------~-------~--~----~ Get latest market updates & search internet right from your browser-download our toolbar here- http://investorline.ourtoolbar.com/ Visit our site at – http://investorline.co.in/ Newsroom: http://newsroom.investorline.co.in/ Learning Center- http://learning.investorline.co.in/ Mutual funds - http://mutualfunds.investorline.co.in/ Life Insurance - http://insurance.investorline.co.in/ Investor Journal - http://research.investorline.co.in/ Newscatcher- http://catcher.investorline.co.in/ Interested in Financial Planning-Let us Contact you- http://spreadsheets.google.com/viewform?key=pb_z4f1_zGMg4iBBFT3-SWQ&email=true If you like the site then promote it here- https://www.freetellafriend.com/tell/?url=http://investorline.co.in/blogs/news Create your own free blog on- http://investorline.co.in/blogger Visit this group at http://groups.google.com/group/india-investor -~----------~----~----~----~------~----~------~--~---
