Proposed rates of RoSL healthy signs for export of garments: SIMA chairman

The proposed rates of Rebate of State Levies (RoSL) have come at a right time and would benefit the garment and made-ups segment, Southern India Mills Association (SIMA) said Thursday. The proposal would also increase the demand from the downstream sector, thereby strengthen entire cotton textiles value chain, SIMA chairman P Nataraj said here in a statement.

He said the industry has also been seeking inclusion of spun yarn and fabrics under RoSL for the last two years and the government should have considered the spinning and weaving and knitting segments as they have been suffering with surplus production capacity for the last few years. The SIMA chief said the envisaged demand would not meet the excess supply from the spinning and weaving segments, and appealed to consider the genuine demand of the industry to include spun yarn and fabrics under RoSL.

Thanking Union Textile Minister Smriti Irani for considering the long-pending demand of the spinning sector and reducing the hank yarn obligation from 40 to 30 per cent with effect from January 2019 to enable Ease of Doing Business. He said that when the hank yarn obligation was reduced from 50 to 40 per cent during 2003, the obligatory quantity was around 930 million kg and that had increased over 1,600 million kg during 2018.

On the other hand, the number of handlooms were 31.37 lakh during 1997-98 and it got reduced to 21.46 lakh during 2009-10, he said. The chairman said the proportionate reduction in obligation works out to less than 15 per cent and therefore, there was room to reduce the obligation further by 10 per cent since as per the handlooms census 2009-10, the actual hank yarn requirement works out to less than 10 per cent. The government has approved the scheme to offer rebate to the State and the central embedded taxes to support the textile sector and boost exports.

(With inputs from agencies.)