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    Measures Taken By India To Promote Textile Exports

    2008/11/26 11:37:00 28

    Textile Exports In India

    India textile minister ShriE.V.K.S.Elangovan wrote in a written report that India's textile export target in 2007-08 was US $25 billion 60 million, but according to preliminary estimates, this year's exports can only be completed by US $22 billion.

    Although export performance fell short of the target set in 2007-08, it still increased by 2 billion 300 million US dollars over 2006-07.

    The reason for the decrease in exports is partly that India's rupee appreciation has exceeded 13% in 2007-08, resulting in the weakening of India's competitiveness in the international market.

    In addition, the growth of India's textile and apparel products in some major overseas markets has slowed down.

    The proportion of 2007-08 textile products in the national export scale dropped from 15.16% in 2006-07 to 13.5%.

    In order to promote India's textile exports and enhance the strength of the textile industry, India government has adopted a series of measures to promote the development of the textile industry in recent years:

    (I) the government set up a task force on Cotton Technology (TMC) to enhance cotton productivity, provide quality cotton for manufacturers and enhance export competitiveness of downstream textile products.

    (II) the establishment of the technology renewal fund arrangement (TUFS) aimed at promoting the modernization of organized and non organized textile enterprises.

    (III) to provide a first-class infrastructure for the textile industry to help textile enterprises integrate with the international environment and achieve social standards. The government approved the comprehensive textile garden arrangement in August 2005.

    (IV) the budget of the overall textile industry (excluding man-made fibres and filament) can be selected from the consumption tax in.

    In the 2005-06 budget, the central value-added tax (CENVAT) of polyester filament fell from 24% to 16%.

    The aim is to attract more investment and promote the modernization of the textile industry.

    (V) the import tariff of textile machinery decreased from 15% to 10% (excluding 23 machines listed on the basic tariff list 49) in order to raise the international competitiveness of India's textile products in the post quota period (2005-06).

    (VI) the government approved the September 2003 w.e.f. debt restructuring arrangement, which allowed banks to lend to textile companies at 8-9% interest rates.

    (VII) the government has opened 100% direct foreign investment automatic channels for textile enterprises.

    (VIII) the government has separated garment enterprises, hosiery enterprises and knitting enterprises from small and medium-sized enterprises, encouraging large-scale investment to enter these enterprises.

    (IX) the establishment of the National Fashion Technology (NITF) organization, which aims to lead the textile and garment industry to experience and accept fashion values, train professionals, and manage the textile and garment industry.

    (x) the government provides a series of preferential measures to textile exporters, such as raising the tax rebate rate of rights and obligations certificates (DEPB&Duty), reducing the cost of India export credit guarantee company (ECGC), providing loan interest rate subsidies, and returning all exporters' various services tax.

    (XI) set up a clothing training and design center in the whole country to provide skilled and semi skilled manpower resources needed for the textile industry.

    (XII) in order to take seriously the problems arising from market education and meet the changing trading environment and the needs of an open world economy, the government has taken the following steps:

    * to set up a national excellent academy and engage in fashion business education according to international standards.

    * designate an institution to standardize and unify the national fashion business education.

    * the establishment of a top body, training teachers and trainers to teach Fashion Business Education in India.


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