Cloth manufacturers seek cut in import duty on machinery spares

With the import of weaving machines catching on in the weaving industry in the region, the industry feels strangled by the heavy import duty imposed by the union government on the machinery spares.

"Costlier machinery spares with heavy import duty of around 36 per cent makes them unaffordable. This leads to the wide usage of duplicate, sub-standard domestic parts which in turn can result in bad quality of the fabric, besides affecting the life of the machine," said K Murugasamy, president of the Shuttleless Loom Cloth Manufacturers Association of Tamil Nadu (SLCMAT).

Stating that more number of weaving parks were to be established in the country, he said that these parks, run by small entrepreneurs, would go for imported second hand weaving machinery to cut down costs.

For instance, the Palladam Hi-Tech Weaving Park (PHWP), first of its kind in the country to be set up at an investment of Rs 250 crore under the Scheme for Integrated Textile Parks (SITPs), is also planning to use more number of imported second-hand weaving machinery.

The park, which would become operational by September 2006, will have 105 sheds with 700-odd looms. Of the total 700-odd looms, 500 would be new ones and the remaining 200-odd would be second hand imported ones.

"We want the government to provide the same subsidy of 5 per cent to the spare parts, which is given to the machinery under the Technology Upgradation Fund Scheme (TUFS)," he added.

Moreover, because of the high export of cotton and yarn, which are the raw materials for weaving industry, there was a lesser availability of these materials for domestic consumption. The volatile yarn market leads to poor market price for the fabric, he pointed out.

Hence, the government should come out with immediate measures to regulate the yarn market and make a better price realisation for the fabric, E K Ponnusamy, joint secretary, SLCMAT, said.

The association also sought reduction in electricity charges from the present Rs 4.50 per unit. The weaving industries are charged as per the state government's commercial tariff and power alone accounts for almost 33 per cent of the total production cost, the association points out.

Of the total 10,000 shuttleless looms in the state, more than 3,000 are in the Coimbatore district. The weaving industry earns around Rs 1,500 crore per year as foreign exchange to the government and Coimbatore accounts for almost 50 - 55 per cent, contributing around Rs 800 crore.