SPEECH OF SHRI ARVIND GUPTA, CHAIRMAN, INDIAN WOOLLEN MILLS’ FEDERATION AT THE 36TH ANNUAL GENERAL MEETING ON TUESDAY, THE 8TH SEPTEMBER 2009 AT THE PLAZA ROOM, HOTEL MARINE PLAZA, MUMBAI.

Good Morning, Members of the Indian Woollen Industry, Distinguished Guests and Senior Officers of the Government. I take this opportunity of extending a very warm welcome to all of you to this combined 36th Annual General Meeting of the Indian Woollen Industry.

Worldwide recession during the previous year has affected every segment of business all over the world and our industry is no exception. However, we are very hopeful and optimistic for coming times and hope to see great improvement during 2009-10.

I am sure you are aware that your Federation had made several representations to the Minister of Finance and Minister of Textiles, Government of India, during the previous year. Due to our continuous follow up and representations during the year, relief in duty has been provided for Wool Waste which has been reduced from 15% to 10%.

In addition to this, our industry was also subjected to harassment on Tow to Top conversion due to different interpretation of the relevant chapter on Excise Duty. With very vigorous representation, this anomaly has now been removed and a Notification has been issued by Government of India during the recent Union Budget. The benefits of this Notification are primarily for Worsted Textile Industry, which has to use Tow to Top converter. The recent Notification has been issued with prospective effect since there was a case pending in the High Court which was filed by one of the members of our Industry. The decision of High Court has come in favour of the industry but Government of India has decided and has gone to Supreme Court in appeal for collection of Excise Duty for the period upto the date of recent Notification.

There are still many issues pending from our Wish List, which remain to be represented and relief sought from Government of India. These are:

1. Abolition of import duty on import of Greasy Wool, other Animal Fibre, Woollen Rags and Flax Fibre.
2. Reduction of import duty to 10% on Wool Tops of 15.6 microns or coarser where facilities are available in the country for converting raw wool into wool tops.
3. Total abolition of import duty on Wool Tops of 15.5 microns or finer because there are no facilities available to process such fine wools in our country and the industry has to fully depend on import of tops to enable it compete with leading manufacturers of countries like Italy.
4. Further reduction of basic import duty on Wool Waste from 10% to 5%.
5. Exemption of flax fibre from levy of 4% additional duty.
6. Reduction of basic import duty from 10% to 5% on staple fibres of Nylon and Polypropylene.
7. Abolition of import duty on specified textile and garment machinery (including woollen machinery) covered by list Nos. 30, 31 & 46(D); Textile and garment machinery falling under Chapter Heading 84.44 to 84.49, 84.51 & 84.52 (except 84.52.10, 84.52.30.10 and 84.52.90.10) and Spare Parts for general textile machinery and also for machinery covered under List No. 46(D)

Your Federation has also made a request to Government of India for removal of ban on setting up of shoddy industry in SEZ/EOU areas, which appears in Para 7 of Appendix 14-1-C of Hand Book of Procedures so that the shoddy industry can flourish in the country.

The carpet yarn manufacturing industry in Bikaner is going through a very bad patch as purchase of carpets by developed countries has dropped considerably in the last about one year. As you are well aware, Bikaner Wool Mandi is well known and it is one of the biggest wool markets in Asia. There was a time when there were 163 woollen mills in Bikaner with production capacity of about 1.5 lakh kilos of carpet woolen yarn per day and were catering to 75% of the carpet woollen yarn requirement. A survey recently carried out by your Federation has found that 74 woollen yarn manufacturing units have completely closed and 65 are partially working, resulting in very big drop of production of carpet woolen yarn to less than 50,000 kilos per day. We have constituted a sub-committee to study the matter and find solutions to overcome the problems faced by this segment of woollen industry.

FTA/PTA/BILATERAL TRADE AGREEMENTS:
 
Indian Woollen Mills’ Federation has been submitting comments on finalization of sensitive lists with various countries for safeguarding the interest of India, owing to high export strength at competitive prices of different countries. Federation is regularly attending the meetings called for discussing FTAs/PTAs/Bilateral Trade Agreements and taking very cautious approach with regard to textile and clothing sector while negotiating FTAs/PTAs/Bilateral Trade Agreements. Indian woolen textile industry has to find ways and means to become more competitive, as these are the days of FTAs/PTAs/Bilateral Trade Agreements.

TUF SCHEME:

The Government of India is encouraging fresh investments in textile sector through TUF Scheme, which has been further extended up to 2012. Federation has been regularly participating in all the meetings called by the Technical Advisory-cum-Monitoring Committee.

Federation has always maintained close contact with all the Government Authorities and the Textile Associations in India. I would like to take this opportunity to convey our gratitude to the Ministry of Textiles, Ministry of Finance, Ministry of Commerce & Industry, Central Board of Excise & Customs, for their co-operation and assistance.

I would also like to express my sincere thanks to my co-office bearers and my colleagues in the Managing Committee and the members for their support and guidance during the year.

I have to sincerely thank Mahesh Sanil and all the staff members of the Federation for giving their full support during my tenure.

Before I conclude, I would like to convey my best wishes to the incoming Team and the Chairman, Mr. S.K. Singhal, who has knowledge and rich experience in Wool and Woollen Textile Industry.

Thank you.