Textile sector in Gujarat expects boost to exports

Category: General

Country: India

Image used for representational purpose only

Niyati Parikh / TNN / Updated: Aug 19, 2021, 07:53 IST

AHMEDABAD: With the announcing the new rates under the Rebate on Duties and Taxes on Export Products (RoDTEP) scheme, textile exporters are expecting a boost in order volumes backed by better cost-competitiveness. According to the new rates, RoDTEP extends incentive of 2.5% to 4.5% on the export of yarn and fabrics of different kinds.

Even though ceilings have been imposed on procurement price to be able to avail the benefit, exporters in the textile sector say that the rebate will sure improve their costcompetitiveness.

“Price competition from textile makers in Vietnam and Bangladesh is one of the major challenges Indian exporters face. Both these countries enjoy a free trade agreement (FTA) with European and other markets, giving them a clear
edge over Indian manufacturers. This is especially true for garments and made-ups, where staying costcompetitive was not sustainable for Indian textile makers after the government withdrew the Merchandise Export Incentive Scheme (MEIS),” said Chintan Thaker, chairman, Assocham –Gujarat state council.

“However, with new incentives rolled out as part of RoDTEP, exporters will now be able to offer a competitive price to their customers. Better pricing will help manufacturers gain more order volumes and in turn boost their revenue,” Thaker added.

In the textile sector, export demand has begun to increase with inquiries pouring in for yarn, fabric as well as garments from various countries. The rate announcement, according to industry players, has come at the right time, when
exporters can leverage the demand. 

Industry estimates suggest that the textile sector and its ancillaries provide employment to an estimated 75 lakh persons across Gujarat.

Manufacturers of technical textiles as well as manmade fibre (MMF) will have an edge, said industry players.

“As demand rises, our competitiveness will surely go up and bring in greater order volumes. Although the announced rates need to be revised to compensate the actual embedded taxes and levies paid by the exporters in case of
the MMF textile lines. Inclusion of the entire MMF textile value chain will encourage inclusive growth in exports of MMF textiles,” said Narain Agrawal, past chairman, Synthetic and Rayon Textile Export Promotion Council (SRTEPC)

Courtesy: https://timesofindia.indiatimes.com/city/ahmedabad/textile-sector-expects-boost-to-exports/articleshow/85441484.cms