Wednesday, 08 February 2012
Last year after the government imposed 10 per cent excise duty on branded apparels, brands holders had to increase product prices and that negatively affected the growth of the apparel retail. Since consumers tightened their purse strings due to signs of global slowdown and high product rates. In a letter to Union Finance Minister Pranab Mukherjee, Karnataka Hosiery & Garment Association and Taxation Committee Chairman Sajjan Raj Mehta has appealed for its withdrawal, keeping in mind the continued impact in the New Year.
Apparel industry is the second largest job provider with the sector employing nearly 2.5 crore people in India. With the excise impact, small manufacturing units had to shut shop resulting in mass unemployment. According to the industry players, government has been playing a double game, on one hand, it has opened up garment imports at zero import duty from Bangladesh and on the other, it has levied excise duty on domestic garment labels. The apparel industry players are still reeling under the worst impact of excise, high raw material costs, low buying and high inventories coupled with slowdown in the Western countries.