| About 250 units in Amritsar have been closed. The main reasons are costly inputs, lack of value addition by SMEs, high freight rates, and locational disadvantages, compared with cities close to ports. A large number of units have shifted to Kolkata from Ludhiana. Around 20 furnaces in and around Ludhiana are running at a loss of Rs 1 lakh annually. |
| The fasteners' association has also taken up the matter with the Centre on enhancing the central excise exemption limit from Rs 1 crore to Rs 3 crore. |
| Speaking to Business Standard, Fasteners Manufacturers Association of India Chairman Mohinder Paul Jain said, "Almost 1,000 small units here are on the verge of closure and about 250 have closed in Amritsar. We are paying Rs 2,000 as freight per metric tonne extra, compared with that in Kolkata and Vishakapatnam." |
| Since we have to sell the products outside the state, we have to pay the freight. The exemption limit still stand at Rs 1 crore only, whereas the cost of raw materials has gone up remarkably. We want this to be Rs 3 crore, and the state can earn more revenue." |
| The annual turnover of small-scale units easily crosses this exemption limit of Rs 1 crore. Secondly, the SSI units availing themselves of the exemption of central excise pay more duty than the units availing Cenvat credit. |
| "The present central excise exemption limit of Rs 1 crore for SSIs is not sufficient because prices of iron and steel have increased by more than 100 per cent during the past one year. The turnover of small-scale units easily crosses this exemption. SSI units taking the exemption of central excise pay more duty than the units availing the cenvat credit. We also want a concessional rate of duty of 60 per cent of full rate of duty up to value of clearance of rs 100 lacs to be restored. It was with drawn in the last budget 2005-06. And the excise return which was earlier filed monthly has been made quarterly." Said Narinder Bhamra, President, FMAI. |
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