The Union Budget 2023-24 has increased the Basic Customs Duty (BCD) on all textile machinery, spares and accessories from 5 percent to 7.5 percent to be effective from April 1, 2023 till March 31, 2025.
The Union Budget 2023-24 has increased the Basic Customs Duty (BCD) on all textile machinery, spares and accessories from 5 percent to 7.5 percent to be effective from April 1, 2023 till March 31, 2025.
The industry had earlier submitted the pre-budget memorandum demanding to retain the BCD on all machinery, spares and accessories at 5 percent as the country is depending on imports except spinning machinery, spares and accessories, since this is essential to sustain the global competitiveness due to the high cost of capital in India. However, the BCD was proposed to be increased in Budget 2023-24 and therefore, the industry had submitted the post-budget memorandum appealing to revoke the budgetary decision. Consequently, the Government has issued the notification on March 29, 2023 allowing relaxation for certain key machinery, spares and accessories, apart from bringing shuttleless looms under nil rate of duty.
In a press release issued here on Thursday, Ravi Sam, Chairman, The Southern India Mills’ Association (SIMA) thanked the Prime Minister, Narendra Modi, the Union Finance Minister, Nirmala Sitharaman and the Union Textile Minister, Piyush Goyal for bringing the shuttleless looms under nil rate of BCD. "The weaving segment has been the weakest link in the entire textile value chain next to the processing sector and the weaving sector is predominantly in the decentralized sector. The country has hardly around 10 percent of the looms in the shuttleless looms category resulting in lower value addition, high cost of production etc.
Though the EPCG scheme is in existence to facilitate the import of textile machinery at nil rate, with the high volatility in the supply and demand, the industry could not fulfil the export obligation within the prescribed time and facing difficulties. The BCD for several speciality weaving machinery, knitting machinery, sewing machinery parts, components, etc., classified under certain tariff headings have been reduced from 7.5 percent to 5 percent," stated Ravi Sam.
The SIMA Chief also further stated, "In the absence of Technology Upgradation Fund Scheme that expired on March 31, 2022, the decision of the Government would enhance the global competitiveness for the weaving, knitting, garmenting and technical textiles segments to a certain extent. This would encourage investments under the Production Linked Incentive Scheme, PM MITRA Park and also new schemes announced by several State Governments in the country, including Tamil Nadu."
The industry had earlier submitted the pre-budget memorandum demanding to retain the BCD on all machinery, spares and accessories at 5 percent as the country is depending on imports except spinning machinery, spares and accessories, since this is essential to sustain the global competitiveness due to the high cost of capital in India. However, the BCD was proposed to be increased in Budget 2023-24 and therefore, the industry had submitted the post-budget memorandum appealing to revoke the budgetary decision. Consequently, the Government has issued the notification on March 29, 2023 allowing relaxation for certain key machinery, spares and accessories, apart from bringing shuttleless looms under nil rate of duty.
In a press release issued here on Thursday, Ravi Sam, Chairman, The Southern India Mills’ Association (SIMA) thanked the Prime Minister, Narendra Modi, the Union Finance Minister, Nirmala Sitharaman and the Union Textile Minister, Piyush Goyal for bringing the shuttleless looms under nil rate of BCD. "The weaving segment has been the weakest link in the entire textile value chain next to the processing sector and the weaving sector is predominantly in the decentralized sector. The country has hardly around 10 percent of the looms in the shuttleless looms category resulting in lower value addition, high cost of production etc.
Though the EPCG scheme is in existence to facilitate the import of textile machinery at nil rate, with the high volatility in the supply and demand, the industry could not fulfil the export obligation within the prescribed time and facing difficulties. The BCD for several speciality weaving machinery, knitting machinery, sewing machinery parts, components, etc., classified under certain tariff headings have been reduced from 7.5 percent to 5 percent," stated Ravi Sam.
The SIMA Chief also further stated, "In the absence of Technology Upgradation Fund Scheme that expired on March 31, 2022, the decision of the Government would enhance the global competitiveness for the weaving, knitting, garmenting and technical textiles segments to a certain extent. This would encourage investments under the Production Linked Incentive Scheme, PM MITRA Park and also new schemes announced by several State Governments in the country, including Tamil Nadu."