Synthetic and Rayon Textiles Export Promotion Council (SRTEPC) is one of the 35 Export Promotion Councils & Commodity Boards established by the Govt. of India with a specific objective of promoting the export growth of specific products. SRTEPC held its 57th Annual General Meeting on Sept. 2, 2011 in Mumbai, with Mr A.B. Joshi, Textile Commissioner, as the chief guest. During the meeting, SRTEPC released its Annual Report for the year 2010-11 along with Audited Balance Sheet & Income & Expenditure Account. Mr Vinod Ladia, Chairman of SRTEPC, in his speech furnished the following data on the export performance of the Council during the period 2010-11.
(1) Exports of Indian synthetics and rayon textiles during the period 2010-11 are estimated to be USD 4.645 billion equivalent to INR 21,571 crore, registering 9% export growth as compared to 2009-10 at USD4.160 billion equivalent to INR 19,775 crore only. In dollar terms, it is 12 per cent growth. This export was directed to over 140 countries. Director-General of Commercial Intelligence & Statistics (DGCI&S), Kolkata has furnished comparative data as given hereunder:-
Products | 2010-11 | 2009-10 | % Change | Product Share |
1) Fabrics | 10839.95 | 10130.79 | 07 | 50% |
2) Yarn | 5485.61 | 4648.82 | 18 | 26% |
3) Made-Ups | 3431.60 | 3361.65 | 03 | 16% |
4) Fabrics | 1813.64 | 1663.89 | 09 | 08% |
Total | 21,570.80 | 19,775.15 | 9.08 |
|
(Figures in INR crore) |
(2) During the first two months of April-May 2011, the exports of Indian synthetic and rayon textiles were to the tune of INR 4135 crore as compared to INR 3181 crore in the corresponding two months in the year 2010, registering 29.98% export growth. This is quite in line with the CAGR of 26.7% set by MOCI for exports in general. The target set for the whole year 2011-12 is USD 5.500 billion. Mr Ladia on behalf of the Council has accepted this target.
Subject to following two riders:-
(a) Continuation of DEPB scheme or an alternative scheme in replacement of DEPB
(b) Making available of raw material at international prices for export production
A ray of optimism on point (a) above is given by Mr Ladia that MOCI may manage to get extension of DEPB scheme until the alternate scheme is put in place. However, Mr Joshi preferred to evade this issue completely in his speech.
(3) The share of SRTEPC in the export kit of India’s total export of USD 246 billion is quite insignificant at USD 4.465 billion. It works to out to only 1.89%. This figure of USD 4.465 billion accounts for shipments made to 140 countries (average USD 0.032 billion). Remember that SRTEPC had 3865 members as on March 31, 2011 as compared to 3682 members in the previous year. Average export transaction made by a member is USD 0.0912 billion only. Does such performance justify the existence of a separate Export Promotion Council for this product? Few status-holders like Reliance, Grasim, Indo-Rama etc. hold major share in the kitty, leaving some scrubs to others for names sake! The Annual General Body has approved the resolution to increase the number of members to 6000 and to include "Technical Textiles" under its exclusive purview. The "Technical Textiles" is reported to be one of the most promising and fastest growing sectors and no Council is dealing exclusively with this product. Mr Ladia expressed his optimism that by bringing TT under the wings of SRTEPC would expand the product profile and the exports of the Council and bring new members to its fold.
SRTEPC had only INR 5730 crore worth of exports during the year 2001-02. Registering 4 times growth by the year 2010-11, it is worth INR 21,571 crore. At present, India’s share of global trade in synthetic and rayon textiles is said to be 3.5%.
4) Export Destination
As already stated above, 140 countries buy Indian synthetic & rayon textile products from India. Following are the main export destinations:-
Country | INR (Crore) |
| 2730 |
| 2146 |
| 1291 |
| 1215 |
| 1210 |
| 759 |
| 716 |
| 620 |
| 573 |
| 561 |
11) Others | 9750 |
Total | 21,571 |
Region-wise data:- |
|
1) Middle East/Gulf | 25% |
| 23% |
3) EU | 22% |
| 19% |
| 10% |
| 100% |
It needs to be highlighted that Pakistan is the second largest trade partner in this product next only to the UAE. Mr Ladia pointed out that Customs has declared one more land Customs station at the Indo-Pakistan border to facilitate shipment of cargo by land route.
Exporters of synthetic & rayon textile products may be taking advantage of Focus Market Scheme for the shipment made to Brazil, Egypt etc.
5) SRTEPC is active in undertaking trade promotional measures. During the current year (2011-12), the Council has already participated in the 5th Dhaka International Yarn and Fabrics show and Tex World Fair, USA.
The Council has plans to hold exclusive exhibitions in Saudi Arabia, Kuwait, Colombia, Equador and Spain.
Preparations are in progress to hold the combined Indian Textile & Clothing Exhibition in Egypt during January 2012.
SRTEPC has been designated by the MOT as the lead organiser of the combined Indian Textile & Clothing Exhibition titled. INTEXPO being held in Malaysia. Intexpo is meant to showcase the entire range of textiles and garments on a common platform in the Asian region. This exhibition is being held in the context of the India-Malaysia Comprehensive Economic Cooperation Agreement (CECA) which has come into effect from July 1, 2011. On the occasion of INTEXpo, other programmes such as Networking Seminars/Buyers Programmes for the Asian Region are also being planned. INTEXPO is scheduled to be held in the third week of Nov. 2011. Reservation of stalls has already started and for details, the exporters should surf website of SRTEPC (www.srtepc.org).
In the last year (2010-11), SRTEPC participated in the TEX TRENDS INDIA 2011, which was organised by the MOT with the support of MOCI and participation of all textile & allied EPCs. 50 members of the SRTEPC put up impressive display of their products in an area of 800 sq.mtrs. Next edition of this exhibition is scheduled to be held in Feb. 2012.
It needs to be highlighted that Pakistan is the second largest trade partner in this product next only to the UAE. Mr Ladia pointed out that Customs has declared one more land Customs station at the Indo-Pakistan border to facilitate shipment of cargo by land route.
Exporters of synthetic & rayon textile products may be taking advantage of Focus Market Scheme for the shipment made to Brazil, Egypt etc.
5) SRTEPC is active in undertaking trade promotional measures. During the current year (2011-12), the Council has already participated in the 5th Dhaka International Yarn and Fabrics show and Tex World Fair, USA.
The Council has plans to hold exclusive exhibitions in Saudi Arabia, Kuwait, Colombia, Equador and Spain.
Preparations are in progress to hold the combined Indian Textile & Clothing Exhibition in Egypt during January 2012.
SRTEPC has been designated by the MOT as the lead organiser of the combined Indian Textile & Clothing Exhibition titled. INTEXPO being held in Malaysia. Intexpo is meant to showcase the entire range of textiles and garments on a common platform in the Asian region. This exhibition is being held in the context of the India-Malaysia Comprehensive Economic Cooperation Agreement (CECA) which has come into effect from July 1, 2011. On the occasion of INTEXpo, other programmes such as Networking Seminars/Buyers Programmes for the Asian Region are also being planned. INTEXPO is scheduled to be held in the third week of Nov. 2011. Reservation of stalls has already started and for details, the exporters should surf website of SRTEPC (www.srtepc.org).
In the last year (2010-11), SRTEPC participated in the TEX TRENDS INDIA 2011, which was organised by the MOT with the support of MOCI and participation of all textile & allied EPCs. 50 members of the SRTEPC put up impressive display of their products in an area of 800 sq.mtrs. Next edition of this exhibition is scheduled to be held in Feb. 2012.
SRTEPC’s views on continuation of DEPB scheme
Mr Ladia has put up following arguments for the extension of DEPB scheme till an alternate scheme in put in place:-
a) The scheme plays an important role in exports of MMT and is popular among the exporters.
b) Simplicity in the operation of the scheme and its wide coverage.
c) The majority of the members in SRTEPC in merchant exporters & discontinuation of the scheme will have serious impact on exports.
d) The competition from China is increasing where the Govt provides higher export incentives to their exporters.
e) The prevailing adverse global scenario warrants the continuation of the DEPB scheme at least for one year instead of Sept. 31, 2011.
f) He has cautioned the SRTEPC members that they will have to live without DEPB scheme at the nearest future, hence necessary adjustments in the costing must be made while fixing the pricing of the products.
Duty Drawback Scheme—Need for Rate Revision
Mr Ladia had made a presentation on the above matter on May 30, 2010 before the Drawback committee. The Council’s proposals include the following:-
a) All Industry Rate of Duty Drawback as in existence today is not adequate.
b) While fixing the rate, following factors also should be taken into account
i) Cost towards high infrastructure defeciencies in India
ii) High interest rates
iii) Various state-level taxes
iv) High power cost
v) High transportation charges
vi) Bottlenecks at the ports
vii) Delay of getting the refunds claims
c) Detection of value caps put against certain products restricting the amount of Duty Drawback claim. Introduction of a mechanism where values are revised in line with input costs periodically.
Problems in EDI System—changing from 1.0 to 1.5 version
There were transitional problems like delays in the release of EDI Shipping Bills and its transmission from Customs to DGFT website. It caused delay in filing application for DEPB and Duty Drawback claims. SRTEPC held meetings with Chief Commissioner (Customs) Nhava Sheva and Commissioners of Customs, Mumbai & Nhava Sheva and discussed the matter. The issues were brought to the notice of Central Board of Excise & Customs (CBEC) and requested them to put in place a proper mechanism to ensure the smooth transition so that exporters’ problems are minimised. Current report indicate that complaints from the exporters on this issue have come down considerably.
MDA Scheme implementation
The Councils has disbursed Market Development Assistance Scheme benefits to 88 members during 2010-11 to the tune of INR 11918672. The Council, as the designated implementing authority of MDA scheme has done fairly good job on this work.
The MDA scheme at present is applicable to exporters with an annual export turnover of not more than INR 15 crore. The Council has recommended to the MOCI/DGFT to raise this limit of INR 15 crore.
Issue of COO
The Council has collected INR 1,86,895 from the issue of Certificate of Origin and Amendment charges during 2010-11. SRTEPC has issued 2091 COO for non-quota items to member-exporters during the year 2010-11 (Mumbai office 802, Surat office 474, Delhi office 815).
Anti-dumping duty activities
The Council is seized with the problems arising out of the imposition of anti-dumping duty by Turkey on "Spun Yarns made out of man-made fibre" originating from India vide notification dated 11/01/09. USD 0.29 per kg is the anti-dumping duty on this product exported by RSWM Ltd where USD 0.39 per kg for all other exporters.
The Council has received export advice that Turkish authorities did not consider the facility of DEPB, Duty Drawback and Central Excise Rebates as "adjustments" while fixing dumping margins which is incorrect. Moreover, the Turkish authority violated many of the WTO provisions and anti-dumping rules. The Council is of the opinion that the issue may be taken up with the Dispute Settlement Board in WTO. Data have been collected by the Council & submitted to MOT & MOCI.
Meanwhile the Council is also evaluating the possibilities of filing Review petition with the designated authority.
The second Anti-Dumping Duty case is from Brazil which imposed ADD on the import of "Viscose Spun Yarn" originated and exported from India. The Council has collected relevant data from the members exporters for the purpose of filing interim Review. There were irregularities in the investigation which have already been reported to the Govt. of India so that suitable grounds can be prepared to take up this issue with Dispute Settlement Board (DSB) in WTO.
Meanwhile, the Council has evaluated the possibilities of filing a Review petition with the Designated Authority.
The third case pertains to the imposition of ADD by Peru on the import of fabrics made out of polyester staple fibre and Viscose Staple fibre of Indian origin. The ADD range from USD 1.12 to USD 2.76 per kg. The two Indian companies involved were BSL Ltd and Sangam India Ltd. The Indian Embassy officials helped the Indian companies to represent in the personal hearing etc. The duties were effective from June 14, 2010 for a period of 4 months. However, it was reimposed on Oct 12, 2010. During the personal hearing, the Council’s representatives made detailed presentation which dealt with the preliminary findings and argued that many of the adjustments claimed by them for their comparison between "Export Price" and the "Normal Price" had been disallowed.
Second public hearing took place on Feb 14, 2011. It has been noticed that there are many irregularities in the investigation conducted by the Peruvian authorities and suitable actions need be taken by the GOI by taking up the matter to Dispute Settlement Board in WTO.
Overseas Visitors & Foreign Trade Enquiries
The Council office was visited by foreign traders who were given all the correct information about the manufacturers/traders of the synthetic and rayon textile products. The Council organised buyer-seller meets also between the visiting buyers and the concerned Indian exporters so that long term trade contacts could be established.
The overseas buyers are in touch with the Council to identity the appropriate Indian suppliers. 41 importers/agents from 25 countries contacted the Council with specific enquiries during the year 2010-11. It is hoped that few of such enquiries must have materialised into firm orders. The Council provided the prices (domestic, import & export) of different MMF textile items in the market including their supply & the demand. Information about the markets can also be obtained in different varieties & formats.
Conclusion
SRTEPC has performed its duties of promoting the export growth of the products assigned to them. They have got professional personnel capable and committed to render services to the member-exporters. The knowledge-level of the personnel in SRTEPC is high as compared to other Councils. They must be able to achieve export growth to the level of USD 9.445 billion by the year 2013-14 (doubling export turnover of USD4.645 billion which was the export turnover during 2010-11. For this, CAGR for 3 years should be 26.7% as fixed by MOCI for the overall total of export turnover of USD500 billion in the year 2013-14.
- By M. Sreedharan
