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The Government of India has marked up the Budget 2018 allocation for ‘ Remission of State Levies ’ ( RoSL ) scheme to Rs . 2,163.85 crore from Rs . 1,555 crore – a 39 per cent increase over FY 2017-18 .
The increase in RoSL alongside a Rs . 6,000-crore package declared for the apparel and textile industry in 2016 would give a fillip to textile exports from the country , said Union Textile Minister Smriti Irani . Around Rs . 1,800 crore have already been provided to the industry as part of the package , while a payment of Rs . 300 crore is envisaged for the current fiscal , as she said .
The Minister further stated that the Technology Upgradation Fund Scheme ( TUFS ) outlay in the budget has also been hiked by 15 per cent . Noticeably , the RoSL scheme is a major constituent of the aforementioned package that enables the exporters to offset indirect taxes charged by the states that are incorporated in exports . Importantly , the textile exporters can claim RoSL on top of duty drawbacks and additional incentives .
Apparel Online spoke to some of the key exporters to garner their reaction on the developments and discuss other related issues as well .
Lauding the Ministry of Textiles ( MoT ), Gurgaon headquartered Matrix Clothing ’ s Managing Director Gautam Nair said , “ The hike in RoSL funds in Budget 2018 will go a long way in easing the pressure off the exporters , especially the smaller ones who make up 90 per cent of our business .”
There was under-allocation of RoSL funds in the last year ’ s budget which resulted in the non-payment of refund claims . A lot of exporters have been facing financial stringency due to locked-up funds and there is a need to expedite the disbursement of RoSL benefits , he further added .
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Expressing his delight on the move , Ludhiana-based NG Apparels ’ Marketing Director Arrpiit Guptaa stated that it ’ s heartening to see the Government stepping up its support to bolster apparel exports .
“ The sector is currently undergoing difficult times and the increment in RoSL funds will positively impact the entire value chain and will help grow India ’ s share in global apparel exports , which currently is 1 / 5th of China ,” he feels . However , Guptaa also expressed his concern over the dwindling fortunes of apparel industry of Ludhiana , one of India ’ s largest manufacturing hubs .
While counting factors like rising wages , diminishing margins , unpredictable weather , etc ., responsible for the decline , he opines that increase in RoSL rates would definitely give some push to the sector to endure this difficult phase .
On the other hand , Nair at Matrix Clothing rues that there is no provision for the increase in RoSL rates in this year ’ s budget . He notified that there was a 3-month transition period in 2017 wherein the old rates were applicable from July to September and new rates came in October . “ The rates , in fact , have come down by almost half ( 1.75 %) of what was earlier
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“ There was underallocation of RoSL funds in the last year ’ s budget which resulted in the non-payment of refund claims . A lot of exporters have been facing financial stringency due to locked-up funds and there is a need to expedite the disbursement of RoSL benefits .”
– Gautam Nair
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( 3.5 %). We have been pleading the Government that this has seriously affected the apparel industry ,” he tells . Apropos the apparel exports figures for September-December 2017 , Nair observed that there was a serious decline on a Y-o-Y basis and the sector perhaps has not experienced such consistent decline in a long time . “ This should be a huge concern for our industry and the country . The apparel industry is very labour-intensive . If exports go down so sharply and consistently , the employment will also go down ,” he cautions .
Apparels is a price-sensitive industry , maintains Guptaa , adding that further support from the Government will help improve the infrastructure over the time and increase India ’ s competitiveness against rivals like Bangladesh .
The apparel manufacturers have to abide by the laws , extend all benefits to their employees and still be able to provide profitable pricing to clients . For this , they have to have the Government ’ s support or else it is just a loss for all , he notes . “ I urge MoT to design new policies to enhance India ’ s textile and apparel industry competitiveness vis-à-vis other countries in the long term ,” Guptaa concludes .
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