In its pre-budget proposal, the Indian Federation of Textile Industry (CITI) stated that the removal of artificial fiber import duties is very important for the textile industry, and the cancellation of import tariffs can only buy large quantities of raw materials at an appropriate price.
The industry group said that man-made fibers are the world's leading textile fibers, India's man-made fiber consumption ratio of cotton fiber is 14:59 (fiscal year 2009), and the world's ratio is 60:40.
CITI said that in India's textile and apparel exports, the proportion of man-made fibers in textile products is even lower. Therefore, it is necessary to increase the amount of man-made fibers in the textile industry. In order to correct disproportionate fiber consumption patterns, fiber prices must be appropriate.
The industry organization also suggested that an optional consumption tax be provided for textile products with a uniform tax rate of 4% for all products. Regardless of fiber content, the optional tax of 4% may continue to be implemented.
In addition, all anti-dumping duties on man-made fibers can be abolished and new anti-dumping actions will no longer be considered. Only in this way will it be possible to increase the consumption of man-made fibers in India and promote the development of the textile industry.
According to the report of the Ministry of Textiles, the global fiber consumption trend may be inclined to man-made fibers, because the cotton planting area is limited, and the growth of cotton is also limited.
In addition, the land for cotton cultivation will eventually be reduced because of the expansion of grain cultivation. Therefore, the demand for artificial fibers for textiles will be huge.
According to the latest 2009 man-made fiber data, India's man-made fiber production capacity is 3.4 billion kilograms, accounting for approximately 6% of the global man-made fiber production capacity. In April-November 2010-11, man-made fibers exported US$2.2 billion, compared with US$2.4 billion in exports of man-made fibers in April-November 200-10. The decline is close to 8%.
The government has determined that the target for the export of man-made fiber textile industry in 2014 is US$7 billion.
In addition, the other challenges faced by the textile and garment industry have become more prominent. CITI suggests that as a one-time measure, it can refund the accumulated central VAT credit of textile companies.
Liquid fuels used by textile and garment companies for power generation can be exempted from import duties and consumption taxes. Textile and garment machinery, excluding ring spinning machines, can also be exempt from excise duties and import duties. Parts of these machines are also tax-free.
In addition, new projects under the technical reforms will be immediately resumed, and sufficient funds will be allocated for the plans for this year and subsequent years.
The textile factory is provided with funds for purchase of next year's cotton, and the interest rate is 7%. In contrast, the margin is 10% and the time is 9 months. In fact, after the consumption tax is collected, the fabric can no longer be subject to a state value-added tax.
Finally, the restoration of the DEPB and tax rebate policy for cotton yarns, and the reduction of other textile tax rebates, can be restored to their original levels.
CITI suggests that technical textiles can be listed as a single group and that all technical textiles can receive DEPB/tax rebate rates.
The industry group said that man-made fibers are the world's leading textile fibers, India's man-made fiber consumption ratio of cotton fiber is 14:59 (fiscal year 2009), and the world's ratio is 60:40.
CITI said that in India's textile and apparel exports, the proportion of man-made fibers in textile products is even lower. Therefore, it is necessary to increase the amount of man-made fibers in the textile industry. In order to correct disproportionate fiber consumption patterns, fiber prices must be appropriate.
The industry organization also suggested that an optional consumption tax be provided for textile products with a uniform tax rate of 4% for all products. Regardless of fiber content, the optional tax of 4% may continue to be implemented.
In addition, all anti-dumping duties on man-made fibers can be abolished and new anti-dumping actions will no longer be considered. Only in this way will it be possible to increase the consumption of man-made fibers in India and promote the development of the textile industry.
According to the report of the Ministry of Textiles, the global fiber consumption trend may be inclined to man-made fibers, because the cotton planting area is limited, and the growth of cotton is also limited.
In addition, the land for cotton cultivation will eventually be reduced because of the expansion of grain cultivation. Therefore, the demand for artificial fibers for textiles will be huge.
According to the latest 2009 man-made fiber data, India's man-made fiber production capacity is 3.4 billion kilograms, accounting for approximately 6% of the global man-made fiber production capacity. In April-November 2010-11, man-made fibers exported US$2.2 billion, compared with US$2.4 billion in exports of man-made fibers in April-November 200-10. The decline is close to 8%.
The government has determined that the target for the export of man-made fiber textile industry in 2014 is US$7 billion.
In addition, the other challenges faced by the textile and garment industry have become more prominent. CITI suggests that as a one-time measure, it can refund the accumulated central VAT credit of textile companies.
Liquid fuels used by textile and garment companies for power generation can be exempted from import duties and consumption taxes. Textile and garment machinery, excluding ring spinning machines, can also be exempt from excise duties and import duties. Parts of these machines are also tax-free.
In addition, new projects under the technical reforms will be immediately resumed, and sufficient funds will be allocated for the plans for this year and subsequent years.
The textile factory is provided with funds for purchase of next year's cotton, and the interest rate is 7%. In contrast, the margin is 10% and the time is 9 months. In fact, after the consumption tax is collected, the fabric can no longer be subject to a state value-added tax.
Finally, the restoration of the DEPB and tax rebate policy for cotton yarns, and the reduction of other textile tax rebates, can be restored to their original levels.
CITI suggests that technical textiles can be listed as a single group and that all technical textiles can receive DEPB/tax rebate rates.
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