New Delhi, Nov 28 (KNN) Referring to the complications faced by the apparel sector that largely comprises of the Micro, Small and Medium Enterprises (MSMEs) in the country, the low RoSL rates as compared to the rates of the previous tax regime and unchanged fabric and input costs under the Goods and Services Tax era is not in the best interest of the sector, Apparel Export Promotion Council (AEPC) said.

AEPC in a press statement made the following remarks. The release further said that the council do welcome the increase in the rates of Merchandise Exports from India scheme (MEIS) to 4% of value of exports.

Commenting on the increase in MEIS rates, AEPC Chairman, Ashok Rajani said that the enhancement in MEIS rates will help in the fulfillment of orders for the Christmas festival as it will result in easing the blocked capital. It will help in the mitigation of the currency difference to some extent.

However the council raised disappointed over the announcement of the RoSL. AEPC said that the announced rate is far below than what the Industry has recommended and there has been no consideration of the central taxes rebate in the announcement.

Commenting on the impact of the prevailing situation, AEPC informed that the Industry is witnessing a slowdown with jobs being lost and buyers migrating due to high cost. Once the buyers find alternate resources it becomes difficult for us to get them back.

The council appealed to urgently restore the previous rates of RoSL and Duty drawback.

Citing statistics, AEPC said that the country’s exports have registered a decline of over 39 per cent in the recent times.

The apparel industry has been one of the worst hit by the GST as the industry was earlier on the optional route. Also, the industry comprises largely of SMEs who are finding GST compliance and capital blockage a severe strain on their bottom lines, the release added. (KNN/DA)