Extend RoSCTL scheme benefits to yarn and fabric: CITI to Govt

The Confederation of Indian Textile Industry on Monday said the government should extend benefits of RoSCTL scheme, which presently covers apparel and made-up segments, to yarn and fabric as well to boost their export competitiveness.

The Union Cabinet in March approved the scheme for rebate of all state and central embedded levies for apparel and made-up segments, which would make shipments zero-rated, thereby boosting India's competitiveness in export markets.

CITI chairman Sanjay Jain appealed to Prime Minister Narendra Modi and the government to extend the benefits of RoSCTL to the yarn and fabric segments and stated this would help them achieve higher growth trajectory and generate more employment opportunities.

Jain said a Confederation of Indian Textile Industry (CITI) analysis of the quick estimates of shipments of textile and apparel for July 2019 shows there is an increase in the exports of apparel while cotton yarn and fabric exports have declined by 9.98 per cent and 10.54 per cent, respectively on year-on-year and cumulative basis.

He observed that the change in the trends of exports of apparel and cotton yarn/fabrics is mainly due to the Scheme 'Rebate of State and Central Taxes and Levies (RoSCTL)' announced by the government in March 2019.

RoSCTL scheme has been introduced to provide reimbursement of central and state taxes to make sure that taxes are not exported along with the products, Jain said.

However, he added that yarn and fabric segments have been kept out of the scheme, hence both the sectors are suffering badly at present and their exports are declining.

The CITI chairman claimed that some categories like cotton yarn have seen a year-on-year fall of 35 per cent in exports in the first quarter of the financial year while in June it was at a staggering 50 per cent low.

He said there has also been a downfall in India's position in global textile and clothing exports.

India, which was the world's second largest exporter of T&C products in 2014-17 after China, fell to fifth position in 2018 as Germany, Bangladesh and Vietnam stepped in, Jain said.