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AHMEDABAD: Garment exporters requested that the refund of state and central taxes and levies (RoSCTL) be provided in cash and not in the form of rights credit certificates. Alleging that these certificates are trading at a discount because of the new conditions imposed in the regime, the exporters are at a loss. Estimates of the Clothing exporters and the Association of Manufacturers (GEMA) suggest that exporters negotiate certificates with a 20% discount, which is expected to result in cumulative losses of Rs 1,500 crore.
Chintan Thaker, Chairman of Assocham Gujarat State Council, said: “Scripts are trading at a discount of around 20% in the market. Since garment manufacturers are not importers, they cannot directly use the certificates and sell them to importers. However, with the rebate, exporters do not take full advantage of the incentives. Even though the program was introduced to help exporters, they cannot take advantage of its benefits. »
Industry players have expressed concern over the loss of competitiveness of apparel exporters in the international market. As the demand for these certificates is low, exporters are unable to find buyers at a suitable price.
The textile industry wants the government to relaunch cash redemption instead of tradable certificates because these certificates are trading at a 20% discount. These certificates are sold by the exporters to the importers, who in turn can pay their import duties with the certificates instead of paying the import duties in cash. This results in substantial monetary transfers from exporters to importers.
“Local players will certainly lose export competitiveness because they are in net loss of tariff advantages. This defeats the purpose and intent of the program promoting the government’s Make in India initiative and instead encourages import dependency,” said Vijay JindalPresident, Gema.