Textile Min recommends duty drawback on cotton yarn exports

The Textiles Ministry today said it will pitch for restoration of tax refunds on cotton yarn exports, which were suspended in April 2010 for discouraging overseas shipments in the backdrop of high domestic prices.

The situation has since changed drastically as prices have declined sharply.

"I will be recommending duty drawback on cotton yarn exports to the Finance Minister, with effect from April 1, 2011," said Commerce and Industry Anand Sharma, who has been given additional charge of textiles minister.

In the domestic market, prices of cotton yarn have fallen to Rs 161 per kg from Rs 271 kg in March.

The minister indicated that after the expiry of the tax-incentive Duty Entitlement Passbook (DEPB) scheme on September 30, a robust form of the duty drawback would be introduced to compensate losses of the exporters due to withdrawal of DEPB scheme.

In June, the government extended the scheme after pressures from the exporters and lobbyists.

Sharma today held comprehensive discussions with the stakeholders from different segments of the textiles industry.

Given the enormity of the problems faced by the garment units in Tirupur because of environmental issues, the minister has asked Textiles Secretary Rita Menon to meet concerned officials of Tamil Nadu on Monday.

"I have requested Secretary (Textiles) to travel to Chennai to hold a dialogue with the Chief Secretary (of Tamil Nadu)," he said.

In January this year, the Madras High Court had ordered the closure of dyeing and bleaching units in Tirupur for discharging effluents polluting the Noyyal river.

Further, the minister said, he would also inaugurate three new mills of National Textiles Corporation in Maharashtra, Gujarat and Rajasthan soon.

On the Scheme for Integrated Textiles Parks (SITPs), he said that out of the proposed 25 parks in the country, four will be inaugurated in Maharashtra and Gujarat.

The government provides Rs 40 crore for each SITP and the industry investment is estimated at Rs 5,000 crore.

At present, there are 40 SITPs in various states including Gujarat, Karnataka, Maharashtra, Punjab and West Bengal.