To offset the impact of demand slowdown in the US and
Europe, apparel exporters have demanded incentives in the foreign trade policy which is to be announced soon. Apparel Export Promotion Council (AEPC) chairman A Sakthivel has asked for incentives like the extension of 2 per cent interest subsidy for entire garment and knitwear sector. The government provides interest subsidy to the SME sector only. “It is requested that 2 per cent interest subvention may be given in the year 2012-13 so that exporters can tide over to tight monetary situation,” he said. Since situation in the US and Europe looks grim for the next year as well “the industry seeks extension of 2 per cent Market Linked Focus Product Scheme for the period 2012-13.”
The scheme, under which exporters were availing duty credit at two per cent of freight on board (FOB) value of exports to the US and EU, ended on March 31. The chairman said that these measures will help achieve the trade target of $32 billion by the end of 2017. He said that volatility in foreign currency high interest rates and hike in yarn prices have impacted the apparel sector.
During April-December 2011-12, garment exports grew 25 per cent year-on-year to $9.7 billion, compared to $7.7 billion in the same period last fiscal.