Central Government to Launch New Scheme for Textile Industry in 3 Months; Calls for GST Relief Intensify
Surat: Union Textile Minister Giriraj Singh has announced that the central government will launch a comprehensive scheme for the textile industry within the next three months. During his visit to Surat, industry representatives met him to raise issues concerning GST, pending Input Tax Credit (ITC) refunds, and rising yarn prices.
Losses for Zari Manufacturers Despite GST Reduction
Metallic Zari manufacturers informed the Minister that the GST rate on their products had been reduced from 12% to 5%. However, they are facing financial losses due to the non-receipt of Input Tax Credit refunds.
According to the manufacturers, they pay a higher GST rate on raw material purchases, whereas a lower rate applies to the finished product. They are incurring a loss of approximately ₹7 per kilogram due to the lack of refunds; this figure was cited by industry representatives.
The representatives stated that despite raising the issue multiple times with local officials and the state secretariat, no resolution has been reached. They urged the GST Council to intervene.
Demand for Monitoring Yarn Prices
Textile traders expressed concern over the frequent hikes in yarn prices by spinners. They stated that this is driving up production costs for weavers and textile processors, placing financial strain on the business.
Industry representatives urged the government to regularly monitor yarn prices to ensure manufacturers can procure raw materials at fair rates. Giriraj Singh assured them that prompt action would be taken to address their concerns.
Demand to Raise GST Threshold for Garments Priced Up to ₹10,000
The issue of GST on readymade garments was also raised during a meeting held at the office of the Federation of Surat Textile Traders Association (FOSTTA). According to industry representatives, an 18% GST applies to garments priced above ₹2,500. They have sought to raise this threshold to ₹10,000 to provide relief to the textile trade; this is an industry demand, not an announced policy change.
The textile industry hopes that the central government's proposed scheme will help address issues related to GST, pending refunds, and rising production costs. However, the detailed contours of the scheme and the scope of the relief will become clear only after an official government announcement.
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