The Southern India Mills' Association for mills in Tamil Nadu want a comprehensive textile policy to ensure financial viability and competitiveness of existing manufacturing facilities in the state and encourage investment and value addition.
South Indian industry wants a policy for the entire textile value chain. Such a policy would make Tamil Nadu a global hub for textile manufacturing. Among the proposals are a VAT reduction on cotton textiles to two per cent from five per cent and removal of one per cent market committee cess on cotton and cotton waste. A steep increase in transportation costs is hurting the industry as it has to procure cotton from other states.
A major issue is that there should be a separate power tariff for the textile industry based on load factor and cost-to-serve basis.
The industry has made out a case for various incentives for new investments on the lines of the apparel and textile policy of Andhra Pradesh.
Tamil Nadu has a strong production base. It accounts for one-third of textile manufacturing facilities in India and earns over Rs 60,000 crores as forex earnings annually.
The net value addition in the textile industry in Tamil Nadu is about 37.5 per cent, the highest in the country. The state accounts for about 30 per cent of India’s export of textiles products.
