Cotton Industry Seeks Rollback Of Excise Duty.

AHMEDABAD: Cotton traders, textile industries and garment manufacturers expect the Dravida Munnetra Kazhagam (DMK), which is ruling Tamil Nadu, to pressure the Centre for a rollback of excise duty imposed on branded garments along with an increase in the quota on yarn export as a step to woo the vote bank. Assembly elections in Tamil Nadu, which is one of the major consumers of cotton in the country, will be held on April 13.

With Union minister for textiles Dayanidhi Maran being a DMK leader , industry sources feel it should not be a difficult task. "We are keenly watching the Tamil Nadu elections, where we expect the DMK to compel the Centre to allow yarn export. As over 60% of the cotton consumption in the country is from this state, the party should give in to the demands," said Saurashtra Ginners Association president Bharat Vala.

According to rough estimates, the `50,000-crore Tamil Nadu textile industry directly and indirectly employ close to 15 lakh people across major centres of Tirupur, Coimbatore, Salem and Madurai. K Selvaraju, secretary general, Southern India Mills Association, said 50% of the Indian cotton yarn was being manufactured in the state alone with the industry consuming over 160 lakh cotton bales a year. India has 44 million spindles and the state's share is 20 million spindles.

The spinning industry is demanding an increase in the export of the cotton yarn quota from 720 million kg during the fiscal year 2010-11 to 1,500 million kg in 2011-12, citing a 10-15% increase in production in the year ahead. "This year too, we could have exported 200 million kg more than what we have done," said Selvaraju.

But garment manufacturers have different expectations. Over one-fourth of India's garment exports takes place from Tamil Nadu. Apparel Export Promotion Council chairman Premal Udani said: "With elections in Tamil Nadu and West Bengal, which is another huge apparel base, some political considerations might take place. We have told the finance minister and the textile minister that a partial rollback will not help the industry and a full rollback of excise is needed."

Source : economictimes.indiatimes.com