India has the potential to become a one-stop sourcing destination for brands and retailers from Southeast Asian countries.
There are opportunities for textile manufacturers from Association of South-East Asian Nations (ASEAN) to invest in India and cater to the domestic market as well as exports because of competitive advantages available in India, including availability of raw material, trained man-power, and presence of the entire textile value chain, Minister of State of Textiles Ajay Tamta said in Lok Sabha today.
Further, 100% FDI is allowed in the textile sector under automatic route.
To increase exports of textile and apparel, the government has announced a special package for garments and made-ups sectors. The package offers labour law reforms, additional incentives under Amended Technology Upgradation Fund Scheme (ATUFS), enhanced duty drawback coverage and relaxation of Section 80JJAA of Income Tax Act.
Further, the rates under Merchandise Exports from India Scheme (MEIS) have been enhanced from 2% to 4% for apparel and made-ups from November 1, 2017.
Products such as fibre, yarn, and fabric in the textile value chain are being strengthened and made competitive through various schemes like Powertex for fabric segment, ATUFS for all segments except spinning and Scheme for Integrated Textile Parks (SITP) for all segments.
The government is also providing interest rate subvention for pre and post shipment credit for the textile sector and gives assistance to exporters under Market Access Initiative (MAI) Scheme.
Following steps are being taken by the government for promoting the export of handloom and handicrafts: