Budget 2013 and Textiles

Budget 2013 and Textiles has enhanced the customs duty on raw silk from 5% to 15%. This is in line with the demands of the domestic sericulture industry and cocoon farming community.

To incentivize exports in an environment of global slowdown, the Budget has exempted handmade carpet and textile floor coverings of jute or coir from excise duty regime.

Zero excise duty route in addition to CENVAT route is now available to the cotton and manmade sector and Spun yarn at the yarn, fabric and garment stages. In case of cotton, there will now be zero duty at the fibre stage and in case of spun yarn, there will be a duty of 12% at the fibre stage. This is in keeping with the Textiles Ministry’s initiative for ensuring a Fibre Neutral Textile Policy.

Duty on Branded Garments has been brought down to zero percent under the optional route from 3.5% earlier. This is a major initiative which would cost exchequer Rs. 1300 Crores. All the excise duty relief measures will restore competiveness of Indian exports which are under stress due to favorable treatment given to the new competitors in major markets like EU.

[The zero excise duty on branded garments will not be the CVD of Excise on imports since it is a conditional notification. – Editor/15.03.2013]