Textile exporters unhappy with minor hike in duty drawback rates.

Surat: The exporters of man-made fabrics (MMF) in Surat are unhappy with the central government retaining the duty drawback rate for grey and dyed fabrics with a marginal increase.

In a notification dated November 1, the Central Board of Excise and Customs (CBEC) extended the duty drawback benefits for textile exporters to overcome the barriers they face in exports. CBEC revises drawback rates every year on November 1 for next one year.

The duty drawback rate for grey fabric has been retained with a marginal increase in value cap and for dyed fabric there is a marginal increase in duty drawback rate up to Rs 7 per kg in the value cap.

In case of apparel, though the rates have been retained at the same level (cotton garments 7.7%, blended 9.5%, man-made fibre 9.8%), the value cap for cotton garments has been increased from Rs 103 per kg to Rs 146 per kg while the same value caps of Rs 110 per kg and Rs 150 per kg have been retained for blended and man-made fibre garments respectively.

However, the textile MMF exporters in the city believe that the government should allow some increase in duty drawback to boost export of polyester fabrics.

Duty Drawback is the rebate of duty chargeable on imported material or excisable material used in the manufacturing of goods. The exporter may claim drawback or refund of excise and customs duties being paid by his suppliers. The final exporter can claim the drawback on material used for the manufacture of export products. In case of re-import of goods the drawback can be claimed.

As per the Synthetic Rayon Textile Export Promotion Council (SRTEPC), the annual export of fabrics from city is pegged at over Rs 1,300 crore. However, the marginal increase in duty drawback rates is not going to give a level playing-field to the exporters of MMF fabrics in comparison to those exporting cotton fabrics.

At present, the country's textile exports is pegged at $42 billion.

"The government has revised drawback rates to boost exports of cotton textiles, while the MMF textile is left in the lurch. There should be a win-win situation for both the sector," claimed a textile exporter.

"We strongly demand a handsome increase in duty drawback in the export of polyester fabrics from India. Further, un-rebated state levies should also be refunded through the drawback route for fabrics as in case of apparels. We also want the government to promote investments in weaving sector, which is the backbone of the MMF textile sector" said secretary of Man-Made Textile Research Association (MANTRA), secretary, Dinesh Zaveri.

Source : timesofindia.indiatimes.com