Memorandum to Textile Secretary by TEA
Tirupur Exporters’ Association (TEA) has suggested for a separate chapter for export sector in Monitory Policy to enhance the competitiveness of products and thereby, the export sector should be delinked with the base rate system being followed by the banks.
In a memorandum submitted to the textile secretory, Mr. Sanjay Kumar Panda during his recent visit to Tirupur, TEA president, Mr. A. Saktivel said as the base rate is the minimum lending one, pre-shipment and post-shipment export credit in rupee has to be given at the base rate itself. Till a separate chapter for export is announced, the bank credit rate given to exports may be fixed at 7.0 per cent as the interest rates prevailing in competitive countries are lower than India’s bank’s rate.
Mr. Saktivel said though total textile export from the country has been $35billion, commerce ministry is providing only 6 crore for the market promotion activities through schemes like Market Access Initiatives (MAI) and Market Development Assistance (MDA). “We suggest that instead of going through commerce ministry, textile ministry should have a separate fund of at least Rs.300 crore for market promotional activities mainly for participation in the international fairs conducted outside India and also international meets being held in India”, he said.
Mr. Saktivel said the knitwear exports to European Union is more than 50 per cent and early signing of Free Trade Agreement (FTA) with European Union will be helpful for the country to increase market share in European Union and it is to be noted that as of now, Bangladesh being least developed country is enjoying the duty free status and the total exports from Bangladesh has reached about $26billion against India’s exports of $15billion. Mr. Saktivel also demanded a free trade agreement with Canada to recapture the market there and increase exports to that country.
About the skill development programme, the TEA president said more encouragement should be given to the sector skill council catering to apparel and textile sectors. Besides, the research and development is more important to increase the productivity and efficiency including the reduction of cost in the exporting units, mostly come under SMEs category, which will help increase the competitiveness of the garments in the global market and to carry out this exercise, a special fund may be allotted to the association to fulfill the requirements.
He said government should permit for import of knitting machinery spares at custom duty free imports. The government should also encourage for manufacturing of sewing machines in the country by foreign manufacturing companies with attractive facilities. “We justify our suggestion since the old machines are giving lass productivity and the time has now come for replacement of such machineries”, Mr. Saktivel in his memorandum added.