Maran hints at tax breaks for textile industry

12 June 2009

The government will take adequate steps, both in the short as well as in the medium and long term, to provide relief to the textiles industry, union minister of textiles Dayanidhi Maran said today. In addition, he said, the textile ministry will soon initiate consultation process to form a national fibre policy.

Speaking at a function to release a study report titled, `Impact of Economic Slowdown on Textile and Clothing Industry,' Maran said, as part of a short term strategy, the government will strive to rationalise fiscal structure, exempt service tax, reduce interest rates on pre-and post shipment credit, and facilitate faster clearance of arrears of terminal excise duties and central sales tax.

Over the medium term, he said, the government will impart momentum to the implementation of the technology upgradation fund scheme (TUFS), scheme for integrated textiles parks (SITP) and the technology mission on cotton (TMC) in the Eleventh Plan period.

''In the long run, there is a need for improvement in the infrastructure, labour laws must change and industry should have a new business orientation in line with the global trends,'' he said.

He urged the industry to come forward to give their inputs so as to create a single forum representing all stake holders of textiles industry.

Maran said the major markets for Indian textiles and clothing  export are the US and the European Union and they are showing signs of recovery. However, there is a need to diversify textile and clothing exports to new markets like the Gulf Cooperation Countries (GCC), comprising Bahrain, Kuwait, Oman, Saudi Arabia, Qatar and UAE as also Africa, Latin America, Russia and Oceania.