Textiles industry fears heavy losses

Transporters' strike on the eve of the festival season likely to cause heavy damages

The bad never seem to send for the Surat textiles units . After being badly hit by the recent flashfloods, the industry can expect further tougher times with the indefinite transporters' strike commencing from August 21.

Transporters all over the country have announced that they would go on an indefinite strike from August 21, to protest the decision of the Central Government to impose 10 per cent service tax on them. Transporters of Surat have decided to support the protest.

Surat Textile Goods Transport Association president Yuvraj Desle said: "A general meeting of our association was held on Thursday evening and we have decided to support the protest call of the All India Motor Transport Congress. As per the directives of our apex body, we will halt all types of transport booking, delivery, truck loading and unloading from 6.00 am on August 21."

The heavy rains and the resultant bad roads has disrupted traffic between the two vital points for the textiles industry "" Surat and Mumbai. With the strike call, things are going to go a lot tougher for these units, specially considering that the festival season (the peak time for the textiles industry) is just round the corner.

"In view of the ongoing holy month of Shravan, as well as the upcoming festival season, this is the peak business time for the textile industry. Around 500 to 600 trucks transport textiles from Surat each day.

"So, once we go on strike, the textile industry will certainly incur huge losses. We realise this, but when it is the question of our survival, we have no other option but to go on a strike. We will continue the strike till we are entirely exempted from service tax," Desle said.

Because the National Highway-8 is full of potholes and the stretch between Bharuch and Vapi is not favourable for truckers, consignments which usually take six hours to reach Mumbai from Surat, taking over 10 hours, textiles industry sources said.

With the rains continuing to pour in southern Gujarat, not only domestic sales but also export are hit, causing fears of heavy losses this year, they added.

"The Central government has imposed a 10 per cent service tax on transport bookings. We are already paying Rs 42,000 per truck each year in the form of various taxes such as road tax, national permit, toll tax, etc. We operate with very small profit margins due to intense competition. The move to bring us under the service tax net will put additional financial burden on us," Desle said.

The transporters are hoping that the government will bow down to their pressure and withdraw the service tax.

"In 1997, the government had imposed 5 per cent service tax on us, but the same was withdrawn after we resorted to strike. Chidambaram was the union finance minister at that time. We hope that the government will act likewise this time as well," Desle added.