Excise duty: Retail industry rages,strikes

He said there about 50,000 apparel brands in India,which will be impacted by the announcement made by Finance Minister

Pranab Mukherjee in the Budget for 2011-12.

Out of a total of estimated Rs 1,00,000 crore apparel business in India annually,Rs 60,000 crore comes from the branded apparels,Rajagopalan added.

8220;Nearly 10,000 retail stores across India will close shutters on Monday. We hope that the this move shutting stores will make the government to reconsider this decision,8221; he added.

The Retailers Association of India RAI has members,including Pantaloons,Shoppers Stop,Reliance Retail,Trent Retail Westside and Aditya Birla Retail which also has a host of brands.

According to Future Group Director and CEO Retail Rakesh Biyani,the excise duty has come as a big jolt not only to the companies but also for consumers.

8220;The excise duty has been made mandatory from voluntary by the government,which is harming consumers,apparel makers and retailers. Keeping the stores closed even for a day means loss of revenues for firms. We will collectively talk to the government,8221; Aditya Birla Retail CEO Thomas Varghese said.

Echoing similar concerns,Reliance Retail8217;s Apparel Business CEO Arun Sirdeshmukh said,8221;Heavy excise has already been imposed,now we can only request the government to lift it as it will affect everyone.8221;

Meanwhile,the Clothing Manufacturers Association Of India CMAI has called for a one day 8216;Bandh8217; today at about 50,000 garment manufacturing units across the main clusters in India.

8220;The domestic garment production in India is estimated to be about Rs 100,000 crore annually,so even if production across 50,000 units is shut for a day,losses will be huge,8221; CMAI Executive Director Mohan Sadhwani said.

He said the CMAI representatives will be in Delhi from next week onwards to make presentations to the Finance Ministry and Textile Ministry officials asking for a roll back of the 10 per cent excise duty.

Retail Industry up in arms over Union Budget blow

Leading apparel retailers in the country,including Pantaloons,Reliance Trends and Aditya Birla Retail,will finalise their course of action against the 10 per cent excise duty imposed on branded garments.

The Retailers Association of India RAI that has members including the top retailers in India,is holding a conference call this evening to decide on the sector8217;s response to the excise imposition announced in the Budget.

8220;The entire apparel industry is against the excise duty. We will take a call by evening today,based on consensus of the members. Nobody wants to keep the stores shut as it results in a loss of business,8221; RAI CEO Kumar Rajagopalan said today.

He said RAI has already sent requests for meetings with the government officials to pitch for a rollback of the excise.

Future Group Director and CEO Retail Rakesh Biyani said the excise duty has come as a big jolt not only to the companies but also for consumers. A collective decision on the future course of action will be taken after the RAI8217;s meeting today,he added.

8220;The excise duty has been made mandatory from voluntary by the government,which is harming consumers,apparel makers and retailers. Keeping the stores closed even for a day means loss of revenues for firms. We will collectively talk to the government,8221; Aditya Birla Retail CEO Thomas Varghese said.

Echoing similar concerns,Reliance Retail8217;s Apparel Business CEO Arun Sirdeshmukh said,8221;Heavy excise has already been imposed,now we can only request the government to lift it as it will affect everyone.8221;

Meanwhile,the Clothing Manufacturers Association Of India CMAI has called for a one day 8216;Bandh8217; today at about 50,000 garment manufacturing units across the main clusters in India.

8220;The domestic garment production in India is estimated to be about Rs 100,000 crore annually,so even if production across 50,000 units is shut for a day,losses will be huge,8221; CMAI Executive Director Mohan Sadhwani said.

He said the CMAI representatives will be in Delhi from next week onwards to make presentations to the Finance Ministry and Textile Ministry officials asking for a roll back of the 10 per cent excise duty.

8220;Even retailers are contemplating to keep their stores closed on March 7,8221; Sadhwani added.

Ludhiana garment makers shut down on 10 pc central excise duty

Chandigarh: Ludhiana8217;s Rs 15,000-crore readymade garment industry today shut down its operations for one day,in protest against the Centre8217;s latest move to bring branded apparels under the central excise net.

A swarm of industrialists representing knitting,hosiery,garmenting,shawls and retailing sectors took out a protest rally in Ludhiana and submitted a memorandum to local Central Excise Commissioner.

Dubbing excise duty on readymade garments as 8220;unjustified and uncalled for8221;,industry representatives also threatened to intensify their agitation by going on an indefinite strike,if the excise duty was not removed.

Union Finance Minister Pranab Mukherjee had levied a 10 per cent central excise duty on branded readymade garments mandatory in the Budget 2011-12,presented earlier this week.

The new levy will affect almost 6,000-7,000 units in Ludhiana,industry claimed.

8220;We will not let the Centre to take any such step which will kill the readymade garment industry and we will continue to oppose such anti-industry move tooth and nail,8221; Ludhiana Knitters Association President Ajit Lakra said over phone from Ludhiana.

Ludhiana is one of the biggest hubs of readymade garment business after Tirupur,is a house to famous domestic brands such as Duke,Monte Carlo,besides making apparels for brands such as Reebok,United Colors of Benetton,Wal-Mart,etc.

8220;The prices of cotton yarn have already appreciated by many a times,and now excise duty has been imposed on us8230;how we will survive under such circumstances,8221; rued Komal Jain,Chairman of Duke Group,famous for its T-shirts.

The Centre had earlier imposed excise duty on textile sector in 2004 but it had to withdraw the same after a sustained campaign launched by the aggrieved segment.

Industry,which is also paying 5.5 per cent entry tax on yarn,is perturbed as the excise duty was levied at a time when it is busy in honouring commitments for summer season.

8220;Our entire production schedule during the ongoing peak season has been disturbed due to the excise duty levy,8221; said Jain.

Garment makers are unsure of absorption of another hike in garment prices in view of excise duty. 8220;Rates of garments have increased by 25 per cent in last 3-5 months. And now with this hike8230;how will an another rate hike be absorbed by the market,8221; questioned a garment maker.

According to the industry,after the excise duty levy,the prices of garments would increase in the range of Rs 35-100 a piece.

Another point of worry for the industry was non-accrual of tax credit on excise duty paid. 8220;There is no duty on yarn,fiber8230;how one can take credit of tax paid,8221; said Lakra.

Industry is also worried that excise duty levy would encourage revival of 8216;Inspector Raj8217;,which will prove detrimental to the growth of industry.