India - Govt. should Reinstate Duty Drawback Refund on Cotton Yarn.

The government needs to reinstate the recent withdrawal of duty drawback refund on cotton yarn exports as it is impacting the spinning industry, said Rajiv Sharma, Secretary General, The Northern India Textile Mills Association (NITMA) to SME Times.

He urged, "The government has withdrawn the benefit of duty refund on cotton yarn (grey and dyed), which is affecting the spinners in the textile industry. The government should at least reinstate 4 percent duty drawback on cotton yarn soon."

The government has initiated such steps to check the prices in the domestic market and curb exports on cotton yarn, he said.

However, the four to five percent duty drawback provided to cotton yarn exporters has been recently suspended by the government.

Sharma added that the government should refund whatever duty is imposed in form of duty drawback to the exporters. In fact, the State levies and taxes should also be refunded.

Sharma pointed out, the government recently has also announced new drawback rate for cotton garments, cotton fibers, on cotton made-ups, etc, but did not give any importance to the needs of the spinning industry. The government did not reconsider the cotton yarn duty drawback issue.

The move which the government has taken is inequitable as all other export products are eligible for the refund of duties, but there has been a withdrawal on cotton yarn that is unhealthy for the growth of the sector, Sharma added.

Source : yarnsandfibers.com