Addressing a press conference here last night, Pdexcil chairman, MSMathivanan, said that while the exim policy had separate chapters for exporthouses and export-oriented units, there was no mention of small scalesector, who played a dominant role in the powerloom fabric production.

Likewise, the marketing development assistance, which was given for thepersons who were already exporting, was not extended to the small exportersand new entrants, he said. If assistance was provided to the small scalemanufacturers, they would take more efforts in exporting fabrics, Mathivanansaid.

The Special Import Licences (SIL), granted for export performance of morethan Rs 5 crore, should also be extended to those who exported less thanthat amount, Mathivanan said adding that as SIL commanded a premium, thesmaller section would start to benefit and motivate them to export moregoods. Being the largest industry in the country, there was no proper HRDfacilities available for training the workforce in the textile industry,Mathivanan said adding that latest technological developments and computerand E-commerce knowledge should be properly offered to them, as also to theentrepreneurs.

He also said that the weavers, who pay more tariff per unit of power, werenot able to compete with those paying lesser tariff even in the domesticmarket, due to different rates for power in different states and urged foruniform power tariff, on the lines of proposed uniform sales tax in thecountry. The council also alleged that heavy central excise and sales taxlevies on cotton yarn, coupled with increase in the exemption limit ofcentral excise levy to small-scale spinners, had resulted in massive taxevasions.

Fabrics produced out of yarn purchased without payment of levies were beingsold on cash basis at very cheap prices and such unaccounted sales in theErode weekly textile markets alone were estimated at around Rs 8 to Rs 10crore, claims Pdexcil chairman, MS Mathivanan. Mathivanan said honesttraders were badly hit as they were unable to compete with theircounterparts in the industry, on account of such unhealthy tradepractices.Stating that law abiding businessmen would be `thrown out' of thetextile industry if the situation continued, he asked the central and stategovernments to consider reducing the levies and to take stringent measuresto curb such unhealthy trade practices, in the interest of the industry.

He said a 4 per cent CST was being levied on purchase of cotton by spinnersduring manufacture of cotton fabrics. Manufacturers from the decentralisedpowerloom sector who purchased yarn from spinning mills had to pay 4 percent sales tax, he added. The council has also urged the central governmentto permit import of second hand or old airjet looms under the TechnologyUpgradation Fund (TUF) scheme. The powerloom sector, especially the smallersections, which were more in number, could not utilise the scheme,originally made for the weaving industry, due to strict modalities, termsand conditions, said Mathivanan.

Stating that there was an urgent need to consider relaxations in manyaspects like enhancement of minimum age limit upto 10 years for import ofrapier and projectile looms, he suggested that the government, instead ofinsisting on collateral security for the fund, could treat the projectitself as the security and provide for working capital facilities in thecost of the project. The insistence on companies having to show profits forthree consecutive years to avail the fund should be dispensed with, thecouncil said and called for a reduction in the promoters contribution to 10per cent.