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Chairman Message

SPEECH OF SHRI S.L. POKHARNA, CHAIRMAN, WOOL INDUSTRY EXPORT PROMOTION COUNCIL AT THE 15TH ANNUAL GENERAL MEETING ON MONDAY, THE 26TH SEPTEMBER, 2016 AT PLAZA ROOM, HOTEL MARINE PLAZA, MARINE DRIVE, MUMBAI - 400020.

Good Morning

I heartily welcome you all at the 15th Annual General Meeting of Wool Industry Export Promotion Council (WOOLTEXPRO).

The 15th Annual Report & Audited Accounts along with Auditors report thereon for the year ended 31st March, 2016 are already with you.

With your kind permission, I take them as read.

INDIAN ECONOMY:

India is GDP growth of 7.6% during 2015-16 is one of the fastest growing economy.

Government of India has initiated various novel programmes for growth and development of Textile Industry, significant being:

  • Investment led growth through Make in India
  • Leveraging technology through Digital India
  • Enabling innovation through Start Up India
  • Capability building through Skill India                                                       

The Government of India has given special attention to the textile sector which is evident from the recent initiatives such as incentives for exports and new package for the garment sector.

Infact, the new approach of the government has been job creation, growth for exports and labour reforms.  Textile

Industry welcomes the appointment of Mrs.Smriti Zubine Irani, an enthusiastic and a dynamic Minister of Textiles of the Cabinet Rank as a step towards the revival of the textile industry towards its old glory.  Mrs Irani has interacted with the Chairman and leaders of the textile industry of different sectors including woolen sector. 

The decision of the Hon’ble Minister of Textiles seeking intervention of Hon’ble Minister of Finance with respect to implementation of exemption of NOC from Quarantine Clearance Certificate of import of livestock products reflects her promises and readiness to sort out the textile issues one by one with sincerity.

It has been reported export of textile and apparel decreased by 8% from US$ 3143 million in July 2015 to 2888 million in July, 2016 as compared to the decreased of 7% in India’s overall exports during July, 2016, exports of all the categories declined except Handicrafts excluding Handmade Carpets which increased at 13%. 

The major decline was seen in Jute Manufacturing including floor covering, the decline of  22% if we compare April-July 2016 to April-July, 2015 export of textile and apparel declined by 4% and the overall exports from India also declined by 4%.

India’s export have diversified both in terms of markets and products in the past 2 decades.  India’s woolen exports have gradually found their way into new markets.  The size of developed countries in India’s exports has declined and that of emerging economies increased.

India’s export performance is crucially linked to the performance of its domestic manufacturing sector and it needs a Make-in-India push.

In today’s age of Digital India clarion call of Hon’ble Prime Minister of India Mr.Modi and the information easily available is forcing the companies to re-think the strategies and come up with the products that will be relevant to consumers mainly to young ones.                                                           

Wool Industry Export Promotion Council has submitted the following suggestions to the Ministry to with stand the present crisis and to revive exports:

  • If selvedge declares origin of fabrics, certificate of origin should confirm the same
  • Every lot of fabric imported into India should be tested in internationally accredited labs like intertex
  • Notification number 19/2015-2020 dated 4/9/2015 wherein fabric imported from china is allowed without AZEO testing should be withdrawn
  • Whenever import of spurious fabric is established, criminal and legal action  should be harsh and severe                                            

EASE OF DOING BUSINESS:

 I suggest the immediate implementation of exemption of NOC from Quarantine Clearance Certificate for import of wool and directions to the customs department.                                                                                                               

  • Procedural issues like animal quarantine clearance certificate are hampering the industry.  The Gazette to revoke this process is issued yet the custom is not issuing the relevant notification.                                                                   
  • There is a need to simplify the customs clearance procedure, strengthen EDI system at customs
  • All Shipping companies charges like THC should be uniform as prevailing in Bangladesh and Sri Lanka.
  • There is need to develop world class infrastructure in port and road segment.  The frequent labour unrest at port hampers exporters to meet supply schedule impacting the image of the country.
  • Government may develop ready reckoner for land use with indication of environmental capabilities.
  • Transactional cost in India is between 14-15% whereas internationally it is 2-4%.                                              

EASE OF MANUFACTURING LABOUR REGULATION:

Wage cost account for 20% of total manufacturing cost in textile and apparel sector.  Thus the following reforms are required:                                                                                              

  • Regulate multiple labour regulation
  • Link wage & bonus to productivity
  • Allow hiring of temporary seasonal uptake in demand                                             

EASE OF MANUFACTURING AFFORDABLE POWER:

  • While last year price of crude oil, coal, gas  have fallen straight electricity board have increased power tariff adversely affected the industry.
  • Since power is a state subject, no uniform power policy is followed
  • Open access through power grid should be encouraged for cost competitiveness

Labour regulations like linking wages and bonus productivity hiring of temporary seasonal labourers availability of affordable power cost to the industry which amounts to 10% as of now.                                                      


PROMOTION OF BRANDING:

  • Export to developed market like US, Europe etc. should be provided higher incentives                                                                                                               
  • There should be subsidy including lawyers fees or registration of Brands in target countries.
  • Expenses made an Audio visual/print promotion in foreign countries should get 50% reimbursement.                                                     
  • If selvedge of the fabric contains brand name it should qualify for additional incentives.
  • A policy where government shares brand building investment for first three years of investment should be implemented.

GST:

GST is a single tax on the supply of goods and services, right from manufacturer to the consumer.  It will subsume central indirect taxes like excise duty, countervailing duty and service tax, as also state levies like value added tax, octroi and entry tax, luxury tax.                                                           

The exports of Indian textiles are one of the vibrant exports to all over the world.  The introduction of GST Duty will boost Indian textile exports to a great extent by making it globally competitive.  It is a welcome tax pattern bringing many benefits along with it.Implementation of the GST will lead to lower inputs cost and reduction in the prices of the finished woolen textile at the consumer level.  It will reduce much paper work. The textile industry has high hopes from the GST.                                                           

The legislation amending the constitution to enable goods and service tax has become a law with President assent which has set the stage for GST Council.

Now, the GST Council under the Finance Minister has been constituted.

Once the date of the new tax is notified all state and central taxes that it subsumes will cease to exist.  The government is looking to implement the new tax regime from 1st April, 2017.


DRAWBACK MATTERS:

I,attended the meeting of drawback committee appointed by the central government headed by Shri Saumitra Chaudhuri

with members which visited Mumbai on 26th August, 2016, and made a presentation on All Industry Rates of Duty Drawback for Woollen Textile Products which was well received by the Committee.  I am hopeful that the All Industry Duty Drawback rates and the value cap will get increased on our export products.    

Wool Industry Export Promotion Council has maintained close liason with Australian Wool Innovation and all Textile Council’s including FIEO, Ministry of Textiles & Commerce, Government of India. 

Friends, I earnestly request the members of the Wooltexpro to support and assist, to make wooltexpro one of the vibrant council amongst all the textile council’s so that we can boost exports and contribute for inclusive growth of India.

Before, I conclude , I heartily express my sincere thanks on behalf of Wooltexpro to Smt.Smriti Zubine Irani, Hon’ble Minister of Textiles and also Smt.Nirmala Sitaraman, Hon’ble Minister of State for Commerce & Industry for their guidance and co-operation.

I would also like to thank Smt.Rashmi Varma, Secretary Textiles, Mrs.Rita Teaotia, Secretary Commerce and Mr.Anup Wadhvan, DGFT for their positive response in the matters connected with industries exports.  

Our sincere thanks due to Smt.Kavita Gupta, Textile Commissioner, Smt.Sunaina Tomar and Smt.Geeta Narayan, Secretaries, Ministry of Textiles and to Drawback                                                          

Committee headed by Dr.Saumitra Chaudhuri for favourable consideration of Duty Drawback matters.                                                                                              

My sincere thanks to office bearers, COA Members for sharing my responsibilies and all the members for their co-operation.                                                  

I would like to thank Wooltexpro team headed by Mr.A.P. Deshpande, Executive Director for carrying their duties with dedication and commitments.

Thank you.

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