Apparel July 2019 Apparel July 2019 issue | Page 63

FAIR UPDATE
announced by the Government, especially those
pertaining to additional support for the MSME
Sector, Interest Subvention, additional Credit flow,
and increased Turnover Cap for the Corporate
Tax of 25 per cent, should provide a boost for
Domestic Manufacturers. However, the decision
to relax norms of Local Sourcing for Single-Brand
Retail will have a negative impact on Domestic
manufacturing. Foreign Direct Investment (FDI)
into this segment may, however, go up as a result
of this move.”
He further said that the regime of Goods and
Services Tax (GST) has completed two years,
and CMAI is thankful to the Government and in
particular, the GST Council for its responsive and
supportive approach to all the suggestions of the
Industry during this period. The Industry has more
or less settled down with the new regime, and the
only major request continues to be the proposal
to have a single uniform tax rate of five per cent
across the Textile Value Chain, irrespective of the
product or process.
BANGLADESH: EMERGING THREAT TO
THE DOMESTIC MARKET
Expressing concern over Duty-free Imports
from the neighbouring Country, Bangladesh, Mr
Mehta said, “The biggest problem faced by the
Domestic Garment manufacturers today is the
unrestricted Duty-free imports from Bangladesh,
and the back-door entry of Chinese fabrics
via Bangladesh.”
India has a free trade agreement (FTA) with
Bangladesh, whereby Garments can be exported
without any payment of Duty in to India. In the
absence of any Rules of Origin, Bangladeshi
manufacturers are importing Duty-free fabrics
from China, converting them into Garments, and
exporting them to India, thereby virtually lending
Duty-free access to Indian markets for
Chinese fabrics.
It is important to note that Imports of Garments
from Bangladesh have been growing at the rate
of 82 per cent over the last year and have now
reached US$365 million. At this rate, Imports of
Garments from Bangladesh will touch US$3.6
billion by 2024–25. This will also impact 10 lakh
jobs. Hence recently, the CMAI had a meeting with
the Ministry of Textiles, Ministry of Commerce, and
the Foreign Ministry to discuss this problem and
has got positive assurance from them.
EXPORTS SCENARIO
CMAI also took this opportunity to update the
media about the Exports scenario in the Country.
Giving inputs on the same, Mr Premal Udani said,
“Apparel Exports took a hit with the introduction
of GST in July 2017, as Duty Drawback Rates
were sharply reduced. The Industry took some
time to adjust to the new regime. In FY 2018–19,
Exports showed a downfall from US$16.7 billion
to US$16.1 billion. However, since October
2018, there has been a recovery and Exports
have steadily increased since then. I am happy
to report that even for the first two months of FY
2019–2020, there is Growth month on month,
which is approximately nine per cent over the
previous year.”
He added, “Some of the recent reforms by the
Government, such as Reduction in Cost delivered
by a Refund of the Central and State Taxes, new
Benefits under the Merchandise Exports from
India Scheme (MEIS) and Renewed two per cent
Duty Drawback, have made the Industry
more Competitive.”
The Conference was followed by a question-
and-answer (Q&A) session with the Press
representatives. The 69th edition of the NGF will
get bigger and better as CMAI has invited the
Honourable Chief Minister of Maharashtra, Shri
Devendra Fadnavis, to Inaugurate the mega
Trade Event.
APPAREL
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