Duty drawback rate increase to boost textile exports from India
The Government’s decision to raise the duty drawback rates will boost textile and apparel exports, experts said.
For the financial year 2017-18, India witnessed textile and apparel exports to the tune of $36.05 billion as against the target of $45 billion. Now, the Government has set yet another challenging target of $82 billion by 2021.
To achieve this, the Government hiked the Merchandise Export from India Scheme (MEIS) rate from 2 per cent to 4 per cent on various products and also offered several incentives, including interest subvention. But, these efforts did not yield desired result primarily because of preferential treatment given to small economies like Bangladesh and Thailand in the Western countries, the largest market of India’s textile and apparel exports.
The Union Ministry of Commerce raised the duty drawback rates across all varieties of textile and apparel by up to 70 per cent recently.
Global markets have turned favourable for Indian exporters because of the Chinese Government’s decision to reduce activities in the labour and energy-intensive industries, including textile and apparel. Industry sources said China has reduced its global market share in the textile and apparel segment to 38 per cent from over 40 per cent nearly two years ago.
The increase in the duty drawback rates would help the exporters face the competition in the overseas market. The maximum increase of drawback rates on MMF textiles is by about 1.5 per cent.
Source :- Dailyshippingtimes.com