The Department of Revenue has notified new duty drawback rates for textile and clothing products in a communication dated January 28 and the new rates will come into effect from February 4.
The textile industry here has welcomed the increase in rates for almost all the products. Chairman of the Apparel Export Promotion Council A. Sakthivel said that for cotton T-shirts, the new rate is 2.1 %, which is marginally higher than the existing rate of 1.9 % and for blends, the hike is substantial.
Welcoming the new rates, he said that though the rise is marginal it will benefit the garment exporters. The Council had submitted data for higher drawback rates and it will continue to pursue with the government for higher rates.
Southern India Mills’ Association chairman Ashwin Chandran said duty drawback is a WTO-compatible export benefit and the marginal hike in rates will help increase exports. The duty drawback rate for cotton grey yarn is up from 1.7 % to 1.9 %, for fabric from 1.6 % to 2 %, and made-ups from 2.6 % to 2.8 %.
He appealed to the government to remove the value cap for spandex yarn and certain categories of woven fabrics.