India’s cotton exports grew 26.8 per cent from April to September 2018. The ongoing trade war between the US and China would possibly open up new opportunities for cotton textile exports from India. Alternate schemes for promoting exports are being devised which would improve the competitiveness of the products. These alternate schemes are expected to be WTO compatible.
India is the second largest textile exporter in the world. Today, cotton yarn and fabric exports account for over 23 per cent of India’s total textile and apparel exports. Banking institutions have been instructed to give in-principle approvals to loans in 59 minutes for small and medium units.
There is a suggestion that cotton yarn and fabrics be included under the ROSL scheme as these products also face the incidence of state levies as in the case of made-ups and garments. The ROSL scheme currently covers only state levies. However, there are also central levies, the burden of which exporters have to bear. To make exports competitive, these central levies are also sought to be refunded under a new scheme.
Other proposals are to include cotton yarn under the MEIS and to hike the MEIS for fabrics from two per cent to four per cent.