Hike in GST on garment and fabrics is being opposed across the country and now Telangana Handlooms and Industries Minister KT Rama Rao has come forward in favour of the industry.
The Minister has urged the Union Government to drop the proposal to hike GST.
In a letter to the Union Textiles Minister Piyush Goyal, KT Rama Rao said that SCs, STs and BCs, who constitute 70 per cent of the families in the handloom sector, would be the worst hit by the decision.
The Union Government recently announced to increase the GST from 5 to 12 per cent.
The Telangana Minister said that a striking aspect was that 72 per cent of women were actively involved in the textile industry work. He said, “It is the responsibility of the Union Government to extend all support to these sections. Income of about 67 per cent of families was not more than Rs. 5,000 and incomes of another 26 per cent families was less than Rs. 10,000. Considering all these factors, increasing GST to 12 per cent is definitely not sensible.”
Indian textile and apparel industry has been continuously facing challenges like pandemic, high prices of cotton and silk yarn and increased prices of chemicals.
The Minister said in his letter that about 80 per cent of the units are in the MSME segment and fixing the GST rate at 12 per cent for fabrics and garments would hit the powerloom and handloom weavers adversely. The textile sector, in fact, requires additional working capital. The industry and the market cannot absorb the additional burden of 7 per cent. This apart, it will lead to higher prices for the common people.
He further added that if the Union Textiles Ministry aims to achieve its grand plans of increasing handloom exports to Rs.10, 000 crore and doubling the production to Rs.1.25 lakh crore in the next three years, then it should be investing in weavers instead of trying to drive them out of existence.
