Tax reliefs sought at 69th AGM
The Indian Textile Accessories & Machinery Manufacturers’ Association (ITAMMA) recently held its 69th annual general meeting. Mr. Prem Malik, CITI Deputy Chairman, was the Guest of Honour.
Mr. Chetan R. Ghia, ITAMMA President, spoke in detail on the textile engineering industry (TEI) scenario, the challenges faced and the future growth prospects.
The following is a summary of Mr. Ghia’s speech delivered on the occasion:
According to a recent census carried by the Textiles Committee, there are about 1,446 units engaged in the manufacture of textile machinery and spares having built up an annual estimated capacity of over Rs. 9,000 crores.
Though 60 per cent units are in the SSI sector, production from this sector is just 32 per cent. Complete machinery manufacturers in the non-SSI sector account for 81 per cent of the industry production, whereas the rest is contributed by spares and accessories producers.
There are 584 units manufacturing complete machinery and 862 units making parts and accessories.
TEI, as the backbone of the Indian textile industry, presently meets 45-50 per cent of the overall demand of the industry. Total production of textile machinery & accessories was down by 14 per cent during 2011-12 at about Rs. 5,200 crores as compared to the previous year.
The rise in imports from Rs. 5,000 crores to Rs. 7,000 crores during the year and the fall in exports by 13 per cent caused much concern among industry circles.
From 2005-06 to 2010-2011, TEI production has increased by 40 per cent and exports by 143 per cent, whereas imports remained more of less constant.
Almost 84 per cent of the total production is contributed by the machinery units in Tamil Nadu and Gujarat. Coimbatore leads the pack with a share of 51 per cent, followed by Ahmedabad with a share of 20 per cent and Surat with 13 per cent in TEI production.
At the same time, the Western region is leading with 56 per cent share in total TEI units, followed by the Southern region with 35 per cent.
Tamil Nadu, being the largest producer of yarn in the country, specialises in the production of spinning and allied machinery, followed by textile testing equipment, whereas Gujarat is the leader in synthetic filament yarn machinery production followed by weaving, spinning and processing machinery.
Around 87 per cent of the total TEI production is accounted for by the six clusters, namely, Ahmedabad, Bangalore, Coimbatore, Ludhiana, Mumbai and Surat.
Need for support measures
TEI has pleaded with the Government time and again for promotional policies by taking into account the following industry suggestions:
* Excise duty on all items of textile machinery at eight per cent with no exemption and that on all parts, components and accessories of the textile machinery should be four per cent.
* Uniform treatment to domestic suppliers of machinery to EPCG licence holders and 100 per cent EOUs as both are deemed export.
* Imported second-hand textile machinery should not be given subsidy under TUFS and its derivatives, namely, 20 per cent CLCS and 15 per cent CLCS Scheme, in the name of modernisation.
* Ban on import of second-hand shuttleless looms with weft insertion rate less than 750 mtrs. per minute.
* Tax break for a period of five years for any unit manufacturing hi-tech items of textile machinery with or without foreign collaboration.
* Schemes to support with 100 per cent grant-in-aid for R&D in TEI.
Schemes to support setting up of CFCs and one cluster park in Surat, Ahmedabad and Coimbatore and one CFC in Kolkata for manufacture of jute machinery with 75 per cent financial aid for TEI as this is needed for development and manufacture of hi-tech machinery in weaving, processing and the technical textiles/yarn sector.
Exports
Exports of textile machinery, parts and accessories are estimated at Rs. 800 crores in 2011-12 as against Rs. 915 crores in 2010-11.
In the ITAMMA endeavour to help its members to increase exports of textile machinery spares and accessories during the year, the Association organised catalogue shows in Surat and Bhilwara which were well attended.
Export cell centres set up in Ahmedabad, Coimbatore and Mumbai have done exceedingly well in creating better cohesion among member-exporters in co-ordination with the liaison offices in Coimbatore and Ahmedabad and the head office in Mumbai.
In order to induce greater member participation, innovative schemes like Share-a-Stall, Share-a-Table and Catalogue Displays were introduced in the ‘DTG 2012’ and Indo Intertex Exhibitions at Dhaka and Jakarta. Further, a delegation was also organised to visit Bangladesh mills.
It was decided to arrange for “Need Assessment Survey and Design Clinic Workshop” for ITAMMA members in Ahmedabad. Accordingly, an agreement for the purpose was signed under the Design Clinic Scheme of MSMEs, Project Implementation Committee on behalf of NID and the President of ITAMMA. The related work is in progress.
The Ahmedabad Cluster has taken the initiative under this programme for formation of a special purpose vehicle (SPV) of 12 members. The required documents have been submitted to NPC and the final approval is expected shortly.
CFC activity in Ahmedabad
The ITAMMA members in Gujarat have felt the need to set up a Common Facility Centre (CFC) for TEI with the objective of supporting its sustainability and growth, specifically MSMEs, by addressing common issues such as specialised processes, improvement of quality, manpower capability development, technology/product development, etc.
In order to assess the CFC needs, a survey was carried out by ITAMMA covering 73 member-units located in Ahmedabad, Surat, Vadodara and Surendranagar. Thereafter, the Dy. Director General (Tech.), along with the Liaison Officer, Ahmedabad, made special visits for creating awareness among the members.
Export Excellence Awards
Besides presenting nine Awards for Export Excellence for 2011-12 this year, ITAMMA also annnounced a Special Export Excellence Award to the category of Micro & Small Enterprises and another Special Award in recognition of Patent. The Award winners deserved special praise for putting in great efforts to promote exports.