CHENNAI: Export of knitwear and readymade garments from Tamil Nadu fell by 5.6 per cent in 2017-18 owing to various reasons, including demonetisation, GST and global competition. The garment exports from Tirupur reduced by `16,000 crore last year, O S Manian, Handlooms and Textiles Minister, told the Assembly on Friday. Replying to a question on demands for grants for Handloom and Textiles department, he said textile exports dipped by 10 per cent across India and 5.6 percent in Tamil Nadu.
“About 6500 knitwear and readymade garment companies in Tirupur export to the tune of `50,000 crore a year and provides employment to six lakh workers. However, owing to GST, demonetisation and global competition, textile exports turnover fell to `34,000 crore last year,” he said. Because of the State’s efforts GST on garments was reduced to five per cent.
He pointed out that higher taxation and reduction in other monetary incentives had put the textile industry in deep crisis. The Centre had reduced the rebate on State Levies (incentive provided for exporters on the value of exported goods) from 3.5 per cent to 1.7 per cent. Manian said the Centre is yet to settle the `500 crore dues to Tirupur garment companies.
Noting that about 11.4 per cent of tax imposed in India for exports, the Minister said (other major textile exporters) Bangaladesh and Sri Lanka did not levy customs duty. “The duty drawback rate, had also been reduced from 7.5 to 2.5 per cent,” he explained. Manian said that on May 31, CM Edappadi K Palaniswami had written to the PM to settle `500cr dues towards rebate on State levies and increase duty drawback rate to five per cent.
Meanwhile, the Southern India Mills Association(SIMA) president P Nataraj said, “Refund of ROSL was kept pending from April 2017. The Centre has hastened the process. It has been cleared until Dec 2017.”