Handicrafts sector demands separate stimulus in Budget

The handicrafts industry, badly hit by the global slump in demand, today asked the government to announce a separate stimulus package in the forthcoming Budget for the revival of the sector.

"The council is not demanding a bail-out package, but asking the government to extend certain benefits which are legitimate to this industry," Export Promotion Council for Handicrafts Chairman R K Malhotra said in a statement here.

The council's demands include exemption from service tax and increase in drawback rates.

"Currently, service tax is levied on more than 100 services and exporters use quite a good number of taxable services," Malhotra said.

 

He said that exporters should not be required to pay service tax as the refund procedure is cumbersome.

In 2008-09, handicrafts exports almost halved to $1.79 billion compared to that in the previous year, it said adding that the unabated import of capy-cat Chinese handicrafts in India resulted in losses of over 3 million jobs.

The sector employs about 7 million artisans.