SIMA disappointed by new budget
Chairman of the Southern India Mills Association (SIMA), Dr K Srnivasan, believes the textile industry has been overlooked in the Union Budget for 2008-09.
He said that the industry, which has significantly contributed to economic growth, was hoping the budget would contain various relief measures specifically for the textile sector. According to SIMA, conditions have been tough with the appreciation of the rupee against the dollar at around 15% and cotton prices up 20%.
Demand for import duties on cotton to be reduced from 10% to 5%, the reduction of customs duty and excise duty on manmade staple fibre from 7.5% to 5% and various other measures appear to have been disregarded. Dr Srnivasan suggests these cuts are essential if the sector is to compete with other countries such as China, Pakistan, Bangladesh, Sri Lanka and Taiwan.
Meanwhile, the government has withdrawn shuttleless looms from the exemption list and has levied 8% duty on them, which could seriously harm the weaving sector according to SIMA.
Dr Srnivasan did, however, welcome the announcement that textile clusters for the development of powerlooms were to be established in Bhiwandi and Erode. He said this was the single positive aspect of the budget for the textile industry.
