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Apparel Export Promotion Council flags post-GST issues before Par panel

AEPC suggested that the competitive exchange rate and rupee appreciation be stabilised to protect the interest of exporters

Press Trust of India  |  New Delhi 

GST

Apparel exporters have brought up the problems faced by them post before a parliamentary panel, signalling the "strong likelihood" of a decline in garment shipments from India and possibility of job losses. The (AEPC) made a presentation to the (Rajya Sabha) on Commerce chaired by Naresh Gujral earlier this week. The body pressed for early consideration of tax refunds blocked on the purchase of ginned cotton (agricultural inputs such as agricultural machinery, seeds, fertilisers, power, diesel and the like) and miscellaneous central or state levies like power cross subsidy, stamp duty, property tax and other levies for refund under Rebate of State Levies. The council also drew the attention of the committee members to the issue of extension of exemption of IGST on import under (Export Promotion Capital Goods) or Advance Authorisation from March 31, 2018 to December 31, 2018, in order to provide a longer window for investment decisions. It also asked for allowing utilisation of MEIS (Merchandise Exports from India Scheme) scrips for use in payment of CGST, SGST and IGST to ease the challenges of working capital blockage and other procedural issues. To arrest the decline in exports, the suggested that the competitive exchange rate and rupee appreciation be stabilised to protect the interest of exporters. "The positive impact of is yet to be felt by garment industry where input costs have not come down.

Overall effect of on apparel exporters, especially small and medium exporters, is burdensome and stressful due to substantial increase of working capital and higher transaction cost," Chairman Ashok Rajani said. "It has not only impacted the production of apparel adversely, but has also led to pressure on margins for exporters due to lowering of drawback rates." The council, according to him, has informed the that under the prevailing circumstances, there is a strong likelihood of exports from India dipping in the near future, as the global garment industry is very competitive. "Further, competing countries like Bangladesh and Vietnam have cost advantages on account of preferential trade agreements with major export markets, and buyers are moving to these destinations for sourcing. This could have a cascading effect on the job scenario as exporters will be forced to shed jobs," Rajani added.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Sat, October 28 2017. 14:26 IST
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