India’s Union Finance minister Arun Jaitley today presented Union Budget 2018-19 in Parliament. This is Narendra Modi Government’s last full-fledged budget before the 2019 Lok Sabha elections. Here are the key points from the FM’s budget speech for the textile industry in particular:
The Minister announced that allocation for the textile industry has been increased from Rs. 6,000 crores (in 2016) to Rs. 7,148 crores for FY 2018-19. The industry stakeholders have thanked the Indian Government on the move made but said that the allocated amount falls short of what is needed to take care of the Rebate of State Levies (RoSL) and Technology Upgradation Fund (TUF) schemes’ backlog coupled with the current year’s requirement.
In the Parliament, Jaitley also announced a reduction in Corporate Tax to 25%. Earlier, the slab was for those firms whose annual income was less than Rs. 50 crores in FY 2015-16. In the latest announcement, the benefit has been extended to companies that reported a turnover up to Rs. 250 crores 2016-17. This move will benefit the textile industry, which has a large number of Small and Medium-sized Enterprises (SMEs).
The textile industry also welcomed the extension of fixed-term employment to all segments (earlier it was only for apparel and made-ups). Additionally, paid maternity leave period has been extended from 12 weeks to 26 weeks which will support the women workforce in the sector.
Sanjay Jain, Chairman, CITI is content with the budget announcements. He commented, “Overall a balanced budget. The textile industry will be benefited from the various concessions announced for the SMEs, farmers and the increased budget for the sector, however, need to see how the allocation takes place.”
On the similar tune, Prabhu Damodharan, Secretary for Indian Texpreneurs Federation, said that he welcomes the announcements made but will wait for the blueprint of the execution of the declaration to see if there’s something to rejoice about.
However, Raja Shanmugam, President of Tirupur Exporters Association (TEA) isn’t so pleased with the budget, as reported.