India'S Export Tax Rebate Cuts Textile Exporters Uneasy

India textile exporters are very dissatisfied with the government's reduction in the export tax rebate rate.

Mr DK Nair, director general of the India Textile Industry Federation (CITI), said that the export rebate rate of all textile products had been greatly reduced.

The government's approach is very unfair, because the pressure of international trade is rising sharply.

The export rebate rate of textile products in China, Pakistan and other countries has been raised since August 2008 to help enterprises cope with the weakening western market demand.

Informed sources say that the export rebate rate of India's garments is now between 8.8-10.5.

The new rate of natural cotton yarn is 4%, and the new duty rate of dyed cotton yarn is 5%, regardless of the thickness of the yarn.

The cotton cloth (grey cloth) has a duty rate of 4.6%, a dyed cotton tax rate of 5.5% and a denim rate of 5.7%.

The refund rate of high quality silk fabrics was 9.8%, and the drawback rate of silk fabrics was also lowered.

For the category, the new tax rebate rate is between 8.2-9.5%. The rebate rate of hand knot carpet is 11%, the silk carpet is 14.5%, and the cotton wool carpet is 10.5%.

The tax rebate rate for leather and lining leather is 6.3%, leather shoes 10.5% and leather coats 9.9%.

The tax rebate rate for brass hardware, brass accessories, brass handicrafts and copper handicrafts / handicrafts is about 15%.

Mr Nair stressed that the textile and garment industry in India is facing increasing pressure. On the one hand, it comes from the cost of production inputs and raw materials. On the one hand, the price of self-made products will not rise or fall.

Now the textile and garment industry is seeking government support, but the government is doing the opposite. Instead, it cuts down the export tax rebate rate through technical means.

Shri A Sakthivel, President of the Tirupur Exporters Association (TEA), has written to the finance minister, Shri P Chidambaram, to restore the export tax rebate rate to its original level.

He warned that the government's reduction in the export tax rebate rate will definitely affect the production environment of the export and manufacturing industries, especially the labor-intensive industries, such as textiles and clothing, which in turn will affect the overall national economic development.