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The Southern India Mills’ Association

Committed to Foster the Growth of the Textile Industry

Study GST impact on textile sector: Traders urge PM

SURAT: The Federation of Surat Textile Traders’ Association (FOSTTA) has urged Prime Minister Narendra Modi to form a special task force to study the impact of GST on the textile sector.
In a letter to Modi, the FOSTTA office-bearers have stated that the production of man-made fabric has reduced from four crore meters per day to less than two crore meters, the sale of polyester fabric including saries and dress material has decreased by almost 40% and that the export of finished fabrics has reduced by almost 28% in the last 10 months post-GST implementation.
The FOSTTA stated that more than 60,000 embroidery machines have been shut and that over 90,000 powerloom machines have been sold in scrap in the last 10 months. Thousands of women employed doing hand embroidery work have been rendered jobless due to the closure of the embroidery machines.
FOSTTA secretary Champalal Bothra said, “Many weavers and embroidery owners were investing in modern machines pre-GST, but the rate of investment has almost come down to 70% in the last 10 months due to the implementation of GST. Post-GST, the fabrics imported from other countries including China has become cheap and that the Indian fabrics have become costlier. The benefits of duty drawback scheme to the exporters has been stopped completely.”
Bothra added, “We have urged the PM to re-consider the government’s decision on including textile sector in the GST. We want the government to remove the traders and weavers from the ambit of the GST, while the GST should be charged at the yarn stage only.”