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Our Correspondent

Madurai , Nov. 13

THE Tamil Nadu Chamber of Commerce and Industry (TNCC&I) has urged the Union Government, especially the Textile Ministry, to initiate remedial measures immediately to provide the much-needed succour to the ailing handloom and powerloom industries in the country in general and Tamil Nadu in particular.

In a memorandum submitted to the Union Minister of State for Textiles, Mr Gingee N. Ramachandran, during his visit to the city yesterday, the chamber said that thousands of handloom and textile industries and over 40 lakh workers engaged in weaving, knitting, printing, dyeing, bleaching and yarn trade had been hit hard on account of rising prices and the levy of excise duty on hank yarn.

The chamber has pointed out that when the excise duty at 9.2 per cent was levied on hank yarn and cone yarn in the 2001-2002 Budget, it was vehemently opposed as the levy would cause serious impact on handloom and powerloom industries.

Further, the SSI exemption provided for the first clearance of Rs 1 crore was also withdrawn for the small powerloom sector. The Government announced that hank yarn would be made available to the handloom sector without the excise burden through state governments. However, the handloom sector has been forced to purchase yarn only after payment of excise duty all these months, the Chamber has observed.

The chamber has further said that export of only value-added goods should be allowed and not raw materials so as to protect the indigenous industries. It was wrong on the part of the government to allow unrestricted export of raw cotton and yarn much to the detriment of local textile producers, especially handloom and powerloom industries.

This excise burden, coupled with the rising price of hank yarn and cone yarn, has gradually stifled many handloom and powerloom units and made them unviable as they could neither sell their products locally nor export them and virtually sounded their death-knell.

The memorandum has further said that the 10 per cent duty on finished goods in the current year's Budget and the announcement on bringing all activities associated with the manufacture of clothes in powerlooms under the control of Central Excise would only lead to further cost escalation and stagnation of goods.

The extension of excise duty to powerloom industries denied the level playing field as both the cloths produced by the mill sector and those by the small powerloom industries in the decentralised sector would attract the same duty.

The survival of thousands of handloom and powerloom units in the State and the livelihood of lakhs of weavers across the State are at stake. It is estimated that 25 per cent of the total powerloom industries in the country are situated in Tamil Nadu.

The chamber has observed that after full implementation of WTO implications, only China and India will supply fabrics to the entire world. In such circumstances, the Government should provide all support and assistance to the textile sector to grab the opportunity and even overtake China.

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