Mr. M. Senthilkumar, Chairman, Southern India Mills’ Association (SIMA), has welcomed the Rs. 6,000-crore special relief package approved by the Union Cabinet, and stated that the slew of measures announced for the garment and apparel sector would greatly help boost garment exports that attract 16 to 20 per cent duty in all major international markets.
He has profusely thanked Prime Minister Narendra Modi and Minister of State for Textiles for announcing such an attractive package at a time when the entire textile industry has been passing through a long drawn recession due to delayed FTAs and market access limitations. The package would also help the entire value chain right from fibre to finished fabric due to increased demand in the long run.
The SIMA Chairman has welcomed the relaxation of labour laws, which is a long pending demand of the industry. The announcement of bearing 12 per cent of the employer’s contribution of the Employee Provident Fund Scheme by the Government for the new employees in the garment sector for the first three years would greatly benefit the sector and the employees. He has hailed the announcement of optional EPF for employees earning less than Rs. 15,000 as a big relief for the garmenting sector where a large number of employees work for short term and prefer to take full wages without deduction.
The increase of overtime cap from the current level of three hours to eight hours in line with the ILO norms would benefit the garmenting sector to mitigate the labour shortage and meet the delivery schedule. The introduction of fixed term employment, a long pending demand of the industry, would enable the sector to manage the production demand during peak season and grab export orders.
Mr. Senthilkumar has highly appreciated the increase in subsidy under the Amended TUF Scheme for the garmenting sector from the current level of 15 per cent to 25 per cent and has stated that such an attractive incentive would not only bring in new investments but also motivate the existing units to go for forward integration and increase exports.
Yet another long pending demand of the industry of refunding the State levies in the duty drawback rates would make Indian garments competitive in the global market by preventing the taxes being exported.
He has hailed the inclusion of garments produced out of fabrics imported under the Advance Authorization Scheme under the drawback rate to claim the rates for domestic duty paid on various inputs. He has also welcomed the reduction in the number of working days for workers from 240 to 150 under Section 80JJAA of the Income Tax Act. Garment manufacturing being a seasonal activity and also facing high labour attrition, this reduction would benefit the units which have such problems.