Cheering the special package announced for the textiles and apparel sector today, industry bodies said the move will boost job creation, attract much-needed investments and enable domestic exporters to compete globally.
Government today approved a Rs 6,000 crore special package for textiles and apparel sector to create one crore new jobs in 3 years, attract investments of USD 11 billion and generate USD 30 billion in exports.
Confederation of Indian Textile Industry (CITI) Secretary General Binoy Job said, "We hope once the positive results are out, government will extend it to the entire value chain of textiles as the sector has huge potential for job creation."
Also Read
Apparel Export Promotion Council Chairman Ashok G Rajani said the refund of employers contribution of EPF, additional incentives under ATUFS and enhanced duty drawback coverage will help the industry gain cost competitiveness.
However, he said, the industry is also looking at R&D support and incentives for innovation which have not come through.
"As the Indian textiles and garment industry is facing tough competition in the global market, the refund of state levies come as a breather and would help it gain competitiveness in global markets where we have to compete with other countries that enjoy duty free regime," Chairman, Ficci Textiles Committee, Shishir Jaipuria said.
Exporters' body FIEO President S C Ralhan said the rebate on state taxes through duty drawback route and grant of duty drawback in case of import of fabric under Advance Authorisation would add to cost competitiveness of exports.
The tax incentive relates to enhancing scope of Section 80JJAA of Income Tax Act under which, looking at the seasonal nature of garment industry, the provision of 240 days under the section would be relaxed to 150 days.
Besides, the government will bear the entire employer's contribution of 12 per cent under the Employers Provident Fund Scheme for new employees of garment industry earning less than Rs 15,000 per month for the first three years.
Moreover, EPF will be made optional for employees earning less than Rs 15,000 per month.
"The measures unveiled will give a much-needed impetus to the Indian apparel industry and spur growth, employment and investment," CII Director General Chandrajit Banerjee said.
B K Goenka, Chairman, Welspun Group and Co-Chairman CII National Committee on Textiles, said the proposed flexible labour reforms will help achieve scale in the apparel sector.
