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The Union Cabinet, chaired by the Prime Minister Narendra Modi, has given its approval for continuation of the Rebate of State and Central Taxes and Levies (RoSCTL) on exports of apparel, garments and made-ups.
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The government's decision to continue providing rebate on central and state taxes under the RoSCTL scheme to apparel and made-up exporters will help increase competitiveness and boost outward shipments, the Federation of Indian Export Organisations (FIEO) said on Wednesday.
The Union Cabinet, chaired by the Prime Minister Narendra Modi, has given its approval for continuation of the Rebate of State and Central Taxes and Levies (RoSCTL) on exports of apparel, garments and made-ups.
FIEO President A Sakthivel said the extension of the scheme till March 2024 provides stability and predictability, which augur well for the long-term contracts, and it would ensure additional investments.
He said many neighbouring countries have emerged as India's competitors having tariff advantage either on account of LDC (less-developed countries) status or owing to effective free-trade agreements.
'The extension of RoSCTL benefit coupled with free-trade partnership with the US, the UK, the EU, Australia, Canada, etc, would be a game changer for Indian apparel and made-ups sectors, and will help the sector to get its rightful share in the global trade,' Sakthivel said.
According to FIEO, India exported knitted apparel, woven apparel and made-ups in 2020 worth USD 6.1 billion, USD 6 billion and USD 4.8 billion, respectively.
Bangladesh's exports of these three products stood at USD 19 billion, USD 16.8 billion and USD 1.1 billion in 2020. Similarly, Vietnam exported knitted apparel, woven apparel and made-ups in 2020 worth USD 13.7 billion, USD 13.3 billion and USD 3.2 billion, respectively.
Sakthivel, who is also chairman of the Apparel Export Promotion Council (AEPC), said the scheme will refund all embedded taxes and make our products globally competitive.
'The scheme will go a long way in bringing back positive sentiments and helping the Indian textile value chain attain USD 100-billion annual exports in next three years,' he said.
Sakthivel added that the RoSCTL scheme will make Indian textile and apparel industry more competitive in the global market.
The scheme will also help check the declining trend being witnessed in apparel exports.
India's apparel exports have been losing market share to competitors, he said adding that it fell 20.8 per cent in one year from USD 15.6 billion in 2019-20 to USD 12.3 billion in 2020-21.
'This declining trend in apparel exports is of concern for the nation, given its huge socio-economic importance. The scheme is all set to reverse the trend,' he said.
(PTI)