CITI Chairman Sanjay Jain has welcomed the new textile policy launched by the Gujarat Government for assistance to strengthen the textile value chain.
Jain thanked the state government for being prudent and excluding the ginning and spinning sectors as there is overcapacity and focusing on value-added segments such as weaving, knitting, processing and technical textiles.
The Chairman also highlighted the fact that under the last policy by the state, there has been a lot of investments in the spinning sector.
However, the spinning capacity in India is already in excess with 30% exportable surplus and there is no requirement of any further investment incentives for this particular sector.
He further stated that due to excess capacity in spinning segment and removal of all export incentives, the sector is facing tremendous margin pressure and a lot of NPAs are happening under spinning segment.
Jain appealed to other state governments to take cue from the Centre and Gujarat and ensure that it may not subsidise sectors, where the country is already surplus on capacity.
He also stated that there is a need to have a country-focused approach against the state level policies.