New Textile Policy Proposal can be beneficial to India

25 Jul 2016

New Textile Policy Proposal can be beneficial to India

The policy has proposed strategies that leads to value addition within the country. As of now, India is producing $11billion worth of fibre. However, garments manufactures are only $3.6 billion. It is observed that lots of fibre and yarn are currently exported. The policy is proposed in lines of ILO (International Labour Organization) guidelines.

Some of the insights are:

  • INR 6,000-crore i.e. USD 891.9 million textiles policy predicts significant flexibility in labour laws which will boost exports and generate employment.
  • Some special boost will be allocated to the garment sector which plans to bring more investment and will boost exports.
  • Policy plans to make garments more competitive for the international market by reducing cost of production.
  • Policy aims to make India an exporter of value-added products rather than just raw material.
  • Number of initiatives are also being proposed to promote the technical textiles sector.
  • Policy plans to promote rationalised duty structure for man-made fibre. As of now, 12% duty is applicable on man-made fibre both excise duty and import duty, whereas for cotton there is no duty at all. This is not favorable to both domestic and international market.
  • In the first stage, policy has proposed to reduce man-made fibre duty to 6%. Later, it plans to make the duty neutrality.
  • Policy plans to provide greater incentive to all those units which employ about 70% women. This unit will be supported in terms of giving subsidy for construction of working women’s hostel and other kinds of facilities.
  • Policy plans to make special agreements with countries like Russia and Brazil, so that some preferential tariff pacts can be signed.

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