Port Wings News Network:
Tirupur Exporters Association (TEA), an umbrella body of exporters from Tamil Nadu, has urged the Commerce Ministry to announce WTO-Compatable alternate scheme in place of MEIS.
In a press release issued on 8 June 2019, Shri. Raja M Shanmugham, President, TEA, said the Commerce and Industry & Railways Minister Shri. Piyush Goyal, while addressing in a joint meeting of the board of trade and the council of trade development and promotion on 6 June 2019, has urged the industry and export councils to stop depending on crutches of subsidies and grants from the Central government and strive to make industry more competitive and self reliant.
ABSENCE OF LEVEL PLAYING FIELD
Shri. Raja M Shanmugham said though the knitwear garment exporting units, 80% in MSMEs, in Tirupur are striving hard to be competitive and self reliant, the major concern is absence of level playing field in the global market and he pointed out that the subsidy like The Merchandise Exports from India Scheme (MEIS) was actually introduced for offsetting the infrastructural inefficiencies faced by exports of specified goods including Readymade garments to provide a level playing field. He added that the higher logistics cost and increasing of wages compared to our competing countries are also deterrent factor in enhancing our competitiveness.
Shri. Raja M Shanmugham noted that India is competing with nations like Bangladesh, Vietnam, Cambodia, Ethiopia, Myanmar and Sri Lanka, apart from China which are all enjoying duty free status in European Union due to either being least developed country status / Free Trade Agreement / GSP + preferences and we are at a disadvantageous position. Moreover, Ethiopia is enjoying duty free status in USA and Bangladesh and Cambodia are also enjoying duty free status in Canada. He further said due to intense competition in the world textile trade, manufacturers in India are operating in wafer thin margins.
He apprehend to mention that the immediate removal of subsidy given to RMG sector at this juncture will straight away lead to reduction of our competitiveness in the global market. He further said once if the buyers leave our country and settle in our competing country then, it would be difficult to bring them back immediately.
He said Readymade garment sector is providing more employment to the downtrodden people, that too 60% to women workers and it is required to protect this industry and also cotton farmers, as the fortune of industry is linked with them directly.
Shri Raja M Shanmugham said he has sent a requisition letter to the Union Minister of Commerce and Industry to come out with an alternative WTO compatible scheme with equal benefit of MEIS till inking Free Trade Agreement with EU, UK, EAEU, CEPA with Canada, CECA with Australia and other promising countries for the sustenance of exports.
He said he has also sent requisition letters to The Prime Minister, Union Ministers of Finance, Textiles and MSMEs in this regard.