Textile sector seeks adequate budget funds for export schemes, disbursal

Chennai: The textile sector wants the Union budget to provide adequate provisioning for export incentive schemes and set mechanism for timely disbursal. This will improve the liquidity in the sector and push exports.

The last budget had considerably reduced the allocation for the textile sector. This was mainly due to lower allocation of Amended Technology Upgradation Fund scheme (ATUFS) and discontinuation of Remission of State Levies (RoSL). The budgetary allocation for ATUFs had come down from Rs 2,300 crore for 2018-19 to Rs 700 crore for 2019-20..

“This year even the allocated funds were not fully utilised due to complications in approval procedures. The procedural issues have to be sorted out and the government has to make adequate provision in the budget for the disbursal of long pending subsidies under old TUF Schemes and also under the Amended TUF Scheme,’ said K Selvaraj, secretary general, South Indian Mills Association.

Further, government had notified the replacement of RoSL scheme in March 2019 with the scrip-based Scheme RoSCTL for export of garments and made-ups. Accordingly, in the last Budget for 2019-20, allocation towards RoSL scheme had been reduced to nil vis-a-vis Rs 3,664 crore estimated for 2018-19.

Although the RoSCTL scheme, with a wider scope for rebates, together with continued provision of the Merchandise Exports from India Scheme (MEIS) benefits, was expected to provide a temporary impetus to profitability of the apparel and made-up exporters, there have been procedural issues and resultant delays in clearance of the RoSCTL dues.