Welcoming the first paperless Budget presented by Union finance minister Nirmala Sitharaman in Parliament, the Confederation of Indian Textile Industry (CITI) has said it will lay a strong foundation for future growth of the textiles and clothing industry in India. However, the levy of 10 per cent import duty on cotton has come as a severe blow, it added.

The announcement of setting up of seven textile parks within three years under the scheme Mega Investment Textile Parks (MITRA) will create world class infrastructure with plug and play facilities to enable create global champions in textile exports, CITI chairman T Rajkumar said in a press release.

“The Production Linked Incentive (PLI) scheme for man-made fibres and technical textiles with a total outlay of Rs. 10,683 crore will also help the textile industry to become globally competitive, attract large investments and boost employment generation. Moreover, to achieve the target of $350 billion from the current size of $167 billion, our manufacturing sector has to grow in double digits on a sustained basis. Our manufacturing companies need to become an integral part of global supply chains, possess core competence and cutting-edge technology,” Rajkumar said.

He pointed out that that the government well recognises the fact that the textile industry significantly contributes to the Indian economy and creates huge employment opportunities to the masses, especially to the poorer sections of the society majorly covering illiterate and down-trodden women. “To further enhance this scope and achieve the target of making Indian economy a $ 5-trillion economy by 2025, reduction of customs duty on caprolactam, nylon chips and nylon fibre & yarn to 5 per cent is step in the right direction. This will bring nylon chain on par with polyester and other man-made fibres.”

Rajkumar also welcomed rationalisation of exemption on import of duty-free items as an incentive to exporters of garments, leather, and handicraft items. “All these items are domestically produced in excellent quantity and quality by our MSMEs and help the textile industry and exports too,” he said.

“However, the levy of 10 per cent import duty on cotton and cotton waste has come as a severe blow for the ailing cotton textiles and apparel industry,” the release said. Cotton and cotton waste which is currently under nil rate of import duty is being subjected to 10 per cent import duty through the budgetary announcement comprising of 5 per cent Basic Customs Duty and another 5 per cent Agriculture Infrastructure and Development Cess (AIDC) on cotton and 10 per cent BCD on cotton waste.

Rajkumar appealed to the Prime Minister to consider the immediate withdrawal of the levy of 10 per cent import duty on cotton and cotton waste to sustain the global competitiveness of Indian textiles and apparel industry, and prevent job losses for several lakhs of people, prevent fall in the exports and also curb cheaper imports of value added products from the SAFTA countries like Bangladesh, Sri Lanka, etc.

The move of allowing women to work in all categories and also in the night-shifts with adequate protection, as well as the modified definition of small companies: companies with a paid-up capital not exceeding Rs. 2 crore and a turnover not exceeding Rs. 20 crore are to be considered small companies, implementation of the 4 labour codes, minimum wages to all categories of workers, and all will be covered by the Employees State Insurance Corporation (ESIC) are welcome decisions for the upliftment of Indian economy, CITI said.