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Buddhadeb seeks review of Budget proposals

KOLKATA: Chief Minister Buddhadeb Bhattacharjee has urged the Union Finance Minister to review two Union Budget proposals pertaining to imposition of mandatory levy on ready-made garments and another on reduction of basic Customs duty on raw silk.

The moves, especially the one on textile made-ups, have sparked country-wide protests from the sector.

In a letter written to Mr. Pranab Mukherjee on Tuesday, he said a review was necessary to save the apparel industry and to prevent large-scale unemployment in the sericulture sector. Mr. Bhattacharjee feared that the move on raw silk will flood Indian markets with cheap silk of foreign origin and lead to a crash in raw silk prices.

“Though you have proposed to impose 10 per cent mandatory levy on branded garments, it will practically bring the entire micro and small-scale sector apparel units within the ambit of this tax regime, sparing only the very high-end custom-tailored sector that caters to a small segment of the customers,” he said in the letter.

He mentioned in this context the difficult times being faced by the textile industry on account of the rise in cotton prices, saying that imposition of this levy would be a further burden, severely affecting the apparel industry's viability.

On the need to reduce the basic Customs duty on raw silk from 30 per cent to five per cent, Mr. Bhatacharyya said that while the State Government welcomed any move to bring down the price of raw materials (to help the handloom sector), it was necessary to ensure that the same was not done at the cost of the sericulture industry which provides livelihood to millions of farmers and weavers.

He felt that a better option in this respect would be to allow canalised imports and subsequent marketing on an exempted duty basis to stop silk prices from spiralling uncontrollably.

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