The textile industry in Gujarat, a hub for Indian textiles, expects new investments worth Rs 40,000 cr in the weaving sector, with the Central Government announcing that zero duty on high-speed weaving machines, which had the textile industry worried.
The Union Budget had provided for 7.5% basic customs duty and 10% surcharge on high-speed weaving machines, which had the textile industry worried.
Textiles associations from the state wrote to Finance Minister Nirmala Sitharaman and said imported machinery should be given the advantage of zero duty as was the case for five years, mainly because India does not manufacture high-speed weaving machines of global standard.
Rahul Shah, Co-Chairman of the GCCI textiles taskforce, said, “The weaving sector will see huge investments with zero duty to continue for two years.
To serve incremental market demand till 2030 and replace old machines, investment in the textile and apparel value chain is projected to reach $100 bn. Investment in main production machinery is estimated to be $65 bn by 2030. These investments are expected to generate 15 mn jobs in the same period .”
Ashish Gujarati, former President of the Southern Gujarat Chamber of Commerce and Industry (SGCCI), said, “Gujarat will see investments worth Rs 40,000 cr in the weaving sector because new projects will be competitive with the duty structure. However, the depreciating rupee and high interest rates will play a certain role.
The Technology Upgradation Fund (TUF) scheme, which gives a 10% subsidy for machinery, is not available. The new notification has specified the RPM of these machines but we demand it be changed because machines with the stipulated RPM are not available anywhere. The Central Government had provided relief through a concessional rate of duty for five years till March 31, 2023, and it has now extended it for two more years.”
