INDIA: Gujarat textile sector welcomes Budget but expected more

SURAT: The Union Budget 2005-06 presented by Finance Minister P Chidambaram has generated mixed responses in the textile industry of Surat. Though market experts believe that some of the perks offered in the budget is going to benefit the textile industry, they were expecting more.

President of the Southern Gujarat Chamber of Commerce and Industry (SGCCI) Dinesh Mandlaywala said, ‘‘There is good news for the industry as the excise duty on polyster filament has been reduced to 16 per cent from 24 per cent. But at the same time, the weavers would not benefit if the difference of eight per cent in the excise duty is not passed on to them by the spinners.’’

Mandlaywala said that the texturisers are going to get a benefit of Rs 2.5 per cent on their per kg of manufacturing. The customs duty has also been reduced from 20 per cent to 10 per cent on the imported machinery.

Mandlaywala said, ‘‘There are no good perks for the textile industry. But the Finance Minister has made certain announcements like the insurance cover for the textile workers which are going to benefit the industry.’’

Chairman of the Federation of Indian Art Silk Weaving Industry (FIASWI), Arun Jariwala said, ‘‘There are no perks offered by the Finance Minister for the cotton industry. The duty has been reduced from 24 per cent to 16 per cent for the polyster yarn and there is no reduction in the cotton. Also the reduction in the custom duty on the imported machinery will further affect the local textile machinery industry.’’

Former president of the SGCCI and one of the well-known textile industrialists, Bharat Gandhi, said, ‘‘The reduction in custom duty for the imported machinery will further boost the textile industry. Now the weavers and texturisers could import machinery on competitive rates. The insurance cover scheme for the workers would also benefit the industry and the workers.’’

Laxman Dobaria, a well-known powerloom industrialist, said, ‘‘The capital subsidy of 10 per cent is not going to benefit the processing industry here. We do not have continuous processing industry in Surat or Gujarat and thus the benefit will go to the industries located in South India. I would like to propose the formation of a separate yarn committee to see that the benefits of the excise duty reduction is passed on to the weavers by the spinners and texturisers.’’

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Added: March 1, 2005 Source: Agencies
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