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The Southern India Mills’ Association

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Indian textiles, garment industry facing challenging times

The next year also may turn out to be a challenging time for India’s textile and garment industry, as exporters are still bleedingfollowing the impact of GST and exports are probably going to miss the USD 45 billion target for 2017-18. Garment exporters have been repeatedly asking that the duty reimbursement should be retained at the pre-GST drawback rate of 7.5 per cent, following fallingexports of the country’s apparel — recording a fall of 39 per cent in value terms in October. On the flip side of the coin, India’s cotton production is forecast to reach 37.7 million bales in the year beginning October 1, up from 34.5 million bales produced in 2016/17. As per data from the Textile Ministry, the production of import substitute bivoltine silk in the country is forecast to touch around 6,200 million tonnes (MT) in 2017-18 as against 5,266 MT a year ago, registering an increase of 19 per cent,
2017 turned out to be a mixed blessing for the textile segment. While initiatives were implemented for power loom units and weavers, the much-awaited new National Textiles Policy is yet to see the dawn of the day.
Recently, a Scheme for Capacity Building in Textile Sector to enhance skill development and job creation was launched with an outlay of Rs 1,300 crore. 10 lakh people are expected to be skilled and certified in various segments of textile sector through the scheme, out of which 1 lakh will be in traditional sectors. The year also witnessed the first mega international trade event for the textile sector, which was inaugurated by Prime Minister Narendra Modi, in Gandhinagar, Gujarat, on 30 June.
The event recorded participation from over 100 countries and a total of 65 MoUs with an estimated value of over Rs 11,000 crore were signed during the expo. India Handmade Bazaar, an online portal to provide direct market access to artisans and weavers, was launched in January.
In November, the Textiles Ministry notified post-GST rates under the scheme for Remission of State Levies (RoSL) on exports of readymade garments and made-ups. For garments, the rates range from around 1.25 per cent and 1.70 per cent and for made-ups, they range between 1.40 per cent and 2.20 per cent effective from October.
The Government also enhanced the rates under Merchandise Exports from India Scheme (MEIS) on readymade garments and made-ups from 2 per cent to 4 per cent. The rates will be applicable between November 1, 2017 and June 30, 2018.As India faces heavy competition from countries like Vietnam and Bangladesh, amongst other factors, the need of the hour is a holistic solution that encompasses all segments of the textiles industry. This, say industry experts will enhance the country’s exports which have remained stagnant for the past four fiscals.

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