In the package, the Ministry is learnt to be considering a review of the excise and state duties that have put the industry under considerable pressure vis-a-vis their overseas counterparts who had considerable costs and fiscal advantages.

"The boosting of consumption of the man-made fibres would go along way in boosting the use of cotton for value addition as well as exports," said highly-placed sources in the Ministry of Textiles.The government is also likely to review the cotton and cotton yarn exports be brought under the OGL list and the quantitative ceilings restrictions on cotton yarn exports should be removed.

"Textiles items should be removed from the purview of the Essential Commodities Act except for the ginned and unginned cotton and cotton seeds, besidesother items like raw jute as well as jute textiles," industry sources said.

The industry has already suggested to the government that the Handloom Reservation Act also needs to be scrapped in order to make the domestic industry gear up to the export competition.

Sources in the industry have said that a strategic and a pragmatic approach needs to be framed in order to attain a possible 10 per cent share in the world market.

The textile industry has already demanded that the exemption currently being availed by 100 per cent of textile EOUs and EPCGs needs to extended for one more year in the case of sourcing of the domestic cotton.

The exemption, which is to expire by next month-end will put substantial pressure on the textiles sector, as domestic consumption of cotton as well as exports have suffered a setback.

In the event of the exemption being lifted, industry sources say that both the EOUs as well as EPCGs units would be compelled to import cotton if the thickness of the exported cotton wasbelow 40 counts. According to industry sources, imported cotton was of a superior variety and there was little logic in prescribing it for variety of thickness of 40 counts or below.

Realising this, the industry had removed cotton use restrictions for EOUs and EPCG units. The revalidation of the exemption for other units would help the industry to recover the costs incurred in the past few months, industry sources said.