Reduce GST Rate From 12% to 5% on Garments With Rs.1,000 Plus MRP: Demands Babubhai Ayar
20 December 2020: Babubhai S. Ayar, Chairman, Ashish Domestic Garments Manufacturers Association and Ex-Vice President of The Clothing Manufacturers Association of India (CMAI) has demanded to reduce GST rate from 12 % to 5% on all readymade garments having MRP of Rs.1,000 and more. He has also demanded to keep a uniform GST rate of 5% on all types of cotton yarn, synthetic yarn, fabrics, made-ups & garments.
In a pre-budget memorandum sent to Central Govt., he has stated that in order to achieve the textile/clothing industry target of USD 280 Billion by 2025 from present USD 140 Billion, the Government should bring in progressive, export-oriented, labour oriented as well as production-oriented policy in the new Textile Policy. Last Textile Policy was announced in the year 2000 and no subsequent new Textile Policy has been announced after 2000. It will be in the interest of the trade & industry if new Textile Policy is announced every 5 years by the Central Govt. similar to the announcement of the 5 Year Plans.
Ayar further demanded that unrestricted import of duty-free and quota free garments from Bangladesh should be restricted. Further, these garments exported to India by Bangladesh should be made from Indian and local fabric only. Garments made from China fabrics should not be permitted to enter India. Moreover, the racket of import of used garments into India should be fully stopped since it affects productivity of Indian trade and production capacity of Indian garment manufacturers remain under-utilized.
Asmita Apparel Park spread over 100 acres on Bhiwandi /Kalyan road has become fully functional. Such apparel parks should be developed at Ahmedabad, Surat, etc. under the guidance of CMAI.
Recently announced production linked incentive scheme for apparel and garments should be made applicable to fibre and yarn. It is necessary to see that price and availability of raw materials remain reasonable & steady. Therefore, export of cotton in any form as raw material should be curtailed and more incentives should be given to the export of fabric, made-ups and garments having more value addition.
