Ludhiana sewing machine & RMG sector fumes after budget

Ludhiana, the industrial hub of Punjab experienced a severe jerk on the last day of February, as Budget 2011 brought its key sewing machine and readymade garment (RMG) industries under the cover of central excise duty, thus compelling the sector representatives to launch an agitation against the decision.

A central excise duty of 10 percent on branded garments and one percent on sewing machines has been proposed under the Budget for 2011-12 fiscal.

Clothing and sewing machine industries are the core industries of Ludhiana. Thus, distressed by the proposal of subjecting these core industries to central excise duty imposition, the industry representatives have forewarned of launching a protest against the government if it does not revoke this proposal.

Representatives of the sewing machinery industry have forewarned that, they will not accept this duty imposition and would totally close down their businesses if the government does not withdraw its decision. Also, it would not be feasible for the Rs. 3.5 billion industry to continue with the business if the duty is imposed.

The RMG manufacturers too have considered this duty to be harsh, and have urged the Centre to reconsider the same. Also, it is being claimed that, the move would certainly affect the small scale RMG producers, and would even lead to a rise in the prices of branded garments.

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