Small looms cheer Cenvat waiver

Looms in Unorganised sector say move will end 'inspector raj'

Textile units in the unorganised sector welcomed Union finance minister P Chidambaram' announcement of Cenvat abolition in the Budget, by bursting crackers.

The proposal was overwhelmingly welcomed by the handloom and powerloom sector. Smaller players in the sector gave credit for Cenvat withdrawal to the Union textiles minister Shankarsinh Vaghela.

Manu Patel, president, the Federation of Gujarat Weavers' Association, in Surat said, "We are very happy with the Union Budget. We thank the finance minister, textiles minister and the Prime Minister Manmohan Singh for withdrawing Cenvat. Now we will be able to do business without fearing 'inspector raj.'"

Laxman Dobaria, steering committee member of the federation, said, "Because of Cenvat, we were always too busy with maintaining documents. Cenvat abolition has also relieved us of a lot of financial burden. We believe that Cenvat abolition will speed up the process of value addition, which will ultimately benefit the entire textile industry, especially the powerloom industry."

"Vaghela has done in one and half months what Surat MP Kashiram Rana could not in six years. We staged numerous agitations seeking abolition of Cenvat, but no one heard us. By abolishing Cenvat, the government has relieved us of a major tension and shown that it is an industry-friendly government. Cenvat abolition will led to reduction in our costs and if something can be done about the high power tariff, Surat's powerloom industry would again become a force to reckon with," said Ashok Jirawala, a leading weaver.

Charanjeet Virmani, director, Parag Prints, while reacting to the Budget, said, "The budget is certainly business-friendly. Local weavers are happy because the powerloom industry has been exempted from mandatory Cenvat registration. Processors like us have, however, been given an option to choose Cenvat registration. We are yet to get copies of the exact notifications that have been issued in this regard, so it is difficult to comment about the good and bad sides of Cenvat abolition. But for sure, from the current reactions, one can say Cenvat abolition will certainly not cause any problems to the textile industry."

Pramod Chaudhary, managing director, Pratibha Fabrics Ltd, said, "The Union Budget is especially good for trade and industry. The demand for abolition of cenvat by the powerloom industry has been accepted. Though it has come late, our long pending demand for transfer of excise duty on yarn, has also been accepted, which will lead to end of 'inspector raj'. We will now be able to concentrate more on quality management and exports, which will ultimately benefit the textile industry on the whole. The best part of the Budget is that other sectors such as agriculture, education and health have also been taken care of."

D Mandalywala, president, the South Gujarat Chamber of Commerce and Industry (SGCCI), said, "The budget is good. Cenvat abolition is an excellent decision by the finance minister. Today, is a golden day for the Surat powerloom industry. Our efforts to abolish the Cenvat has finally borne fruit and we are hopeful that this will improve the situation of the textile industry in the state."

"We are very delighted by Cenvat abolition as it was causing great difficulties to us," said Bharat Patel, secretary of the federation.

Chinubhai R Shah, president, Gujarat Chamber of Commerce and Industry (GCCI), said, "The chamber welcomes the Budget, which has provided special incentives and reliefs to the textile sector. Gujarat holds a major share in textile exports and the inentives and reliefs will make textile units of the state more effecient and competitve."