Finance & Economy

CITI Hails the Union Budget 2022-23 – Calls for Inclusive growth of the New India

Published: February 2, 2022

New Delhi, Tuesday, 01 February 2022:  Shri T. Rajkumar, Chairman, Confederation of Indian Textile Industry (CITI) welcomed the Union Budget 2022-23 presented by the Honorable Union Minister of Finance, Smt. Nirmala Sitharaman, in the Lok Sabha House of the Parliament. He said, “CITI hails the Union Budget 2022-23 which aims at inclusive growth of the New India and estimate India’s GDP growth at 9.2% which is highest among all large economies.”

Shri T. Rajkumar while commenting on the budget allocation for the Textile Sector stated that for the year 2022-23, the budget allocation for the Textile Sector stands at about Rs.12,382.14 crore which is about 8.1% higher than the revised budget allocation of 2021-22 which stood at about Rs.11,449.32 crores. He further stated that the budget allocation during 2021-22 was initially Rs.3,631.64 crores. However, it was later revised to Rs.11,449.32 crores mainly due to an increased allocation for “Procurement of Cotton by Cotton Corporation of India (CCI) Ltd. under Price Support Scheme” from Rs.136 crore to Rs. 8,439.88 crores”. For the year 2022-23, the Government has allocated about Rs.9,243.09 for “Procurement of Cotton which is about 9.5% higher than the revised allocation of last year.

In the present budget allocation, the Government has allocated about Rs.133.83 crores for “Textile Cluster Development Scheme” hence the total budget allocation for “Research and Capacity Building” for Textiles has increased by 73.4% to reach about Rs.478.83 crore in 2022-23 as compared to the revised budget allocation of Rs.276.10 crore in 2021-22. He further stated that the recently announced Production Linked Incentive (PLI) Scheme and PM Mega Integrated Textile Region and Apparel (PM MITRA) Scheme also saw an allocation of Rs 15 crore each for 2022-23. The Government has also allocated Rs.105 crore for the year 2022-23 towards “Raw Material Supply Scheme” which has already been approved for the implementation during the period 2021-22 to 2025-26.

CITI Chairman welcomed the PM GatiShakti National Master Plan which encompasses the seven engines for economic transformation, seamless multimodal connectivity and logistics efficiency. The seven engines that drive PM GatiShakti are Roads, Railways, Airports, Ports, Mass Transport, Waterways and Logistics Infrastructure.

Shri T. Rajkumar appreciated the steps taken by the Government for the extension of Emergency Credit Line Guarantee Scheme (ECLGS) up to March 2023. He further said that the guarantee cover under ECLGS will be expanded by Rs. 50,000 Crore to total cover of Rs. 5 Lakh Crore. Similarly, Rs. 2 lakh crore additional credit for Micro and Small Enterprises will be facilitated under the Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE). The Government is also rolling out Raising and Accelerating MSME performance (RAMP) programme with outlay of Rs 6000 Crore. All these steps will strengthen the MSME Segment which holds major share in the Textile & Clothing Sector.

CITI Chairman welcomed the decisions like “Amritkaal” the next phase of Ease of Doing Business (EODB) 2.0 and Ease of Living which will be launched by the Government shortly, an additional allocation of Rs.19,500 crores for Production Linked Incentive for manufacturing high efficiency solar

modules to meet the goal of 280 GW of installed solar power by 2030. He said that such actions of the Government will be fruitful for the textile industry in the coming years.

Shri T. Rajkumar also appreciated the decision of the Government for replacing Special Economic Zones Act with new legislation that will enable the States to become partner in the ‘Development of Enterprise and Service Hubs’. It will cover the existing industrial enclaves and enhance the competitiveness of our textile exports.

CITI Chairman welcomed the move to incentivise exports. He said exemptions on items such as embellishment, trimming, fasteners, buttons, zipper, lining material, specified leather, furniture fittings and packaging boxes will help the textile sector.

Shri T. Rajkumar stated that gradually phasing out of the concessional rates in capital goods and project imports and applying a moderate tariff of 7.5 percent which is conducive to the growth of domestic sector and ‘Make in India’ is a welcome step. He further stated that the certain exemptions for advanced machineries that are not manufactured within the country shall continue and help the textile sector as Indian textile sector depends on state-of-the-art textile machineries.

CITI Chairman concluded by saying that though, the current Union Budget doesn’t make any direct announcement for the textile and clothing sector, however, if we see the entire budget speech in totality, it talks more about the inclusive development of the new India. The Government has already gone beyond a level and has done so much for the textile sector. It is now for India Inc. to look for developing at other important aspects of the businesses like infrastructure development, liquidity, labour and power issues, availability of raw materials, ease of doing business, FTAs, technology transfer, etc to enhance the cost competitiveness of Indian products in the global market.

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