COIMBATORE: Southern India Mills’ Association has sought the abolition of one per cent market committee cess imposed on cotton and cotton waste in Tamil Nadu.

According to the association chairman J. Thulasidharan, the State only produced about five per cent of its textile mills’ annual cotton requirement. Yet, the mills had been paying market committee fee for the entire cotton consumed in the State, including cotton waste. Mr. Thulasidharan appealed to the Union Textile Minister Dayanidhi Maran to take up the matter with the Chief Minister.

Working capital

He also said the industry wanted nine months’ working capital to purchase quality cotton during the peak season.

The capital should be available at seven per cent interest with 10 per cent margin money.

This would give the domestic industry a level playing field with multi-national traders and other competing countries on the raw material front.

New condition

In the Foreign Trade Policy, the Union Government had imposed a new condition for exporting units getting assistance under the Technology Upgradation Fund Scheme.

According to it, the mills would not get zero duty Export Promotion Credit Guarantee benefit for importing capital goods while availing themselves of the subsidy available under the Technology Upgradation Fund Scheme.

This condition should be removed as it affected the export competitiveness of the units.

Export obligation

Several textile mills were unable to fulfil their export obligation within the specified period of eight years that expired with 2009-2010 owing to adverse export market conditions during the last three years.

Hence, the association sought reduction of the export obligation to 50 per cent from the current 75 per cent.

Overall performance

“The average export obligation should be based on overall export performance rather than commodity-specific,” Mr. Thulasidharan said.

Courtesy - Hindu