The government has introduced various measures to benefit almost every segment of the Indian textile and apparel industry. Among these are a new schemes for the rebate of state and central taxes and levies on the export of garments and made-ups, a scheme for the development of knitwear, and a reduction in the hank yarn obligation from 40 per cent to 30 per cent of the total weaving yarn produced for domestic consumption.
Rebates of state and centre levies and taxes will be done through the IT driven scrip system thereby preventing delays and ensuring speedy disbursal. The decision is important as apparel and the made-ups sectors have a combined share of 55 per cent in the total Indian textile export basket. It will have a direct impact on these segments thereby increasing the competitiveness of India’s textile exports globally.
Hank yarn obligation has been reduced from 40 per cent to 30 per cent. The decision is expected to help spinning mills. As a result of the reduction in the obligatory quantity, the premium on hank yarn transfer will also get reduced thus helping spinning mills to reduce their cost. Due to the labour shortage, increase in yarn production capacity, and technology upgradation the need for hank yarn has come down drastically.