the madhya pradesh textile mills association on 1 st june, 1966 af ter being renamed as the madhya...

The Madhya Pradesh T extile Mills Association Annual Report 2015-2016

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The Madhya Pradesh T extile Mills Association

[Incorporated under M.P . Non- Trading Corporations Act, 1962]

ANNUAL REPORT 2015-16

OFFICE BEARERS :

Chairman - Shri Piyush Mutha

Vice Chairman - Shri Akhilesh Rathi

Deputy Chairman - Shri Suresh Maheshwari

Deputy Chairman - Shri Shreyaskar Chaudhary

Secretary - Shri M. C . Rawat

Registered Office :Jall Sabhagraha, 56/1, South Tukoganj, Indore – 452 001

Telephone : 0731 – 2518148 Fax : 0731-2521570e-mail : [email protected]


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CONTENTS

Subject Page Nos.

Objects 3

Member Mills 4

The Year Under Report 5

Raw Material 12

Industry Overview 23

Exports & Imports 35

Taxation 47

Man-Power 51

Power 61

Performance of Member Mills 65


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THE MADHYA PRADESH TEXTILE MILLS ASSOCIATION

Committed to growth of Textile Industry in the State

Object s

* To protect and promote interests of textile industry.

* To take all steps for promoting, protecting, supporting, encouraging, opposing, or seeking

modifications in legislative and other measures affecting the interests of the textile industry.

* To create and encourage friendly feelings and unanimity amongst the member mills on all

subjects connected with their common interest,

* To afford facilities for ascertaining the views of persons engaged in textile industry and for the

communication and interchange of views between the members interse.

* To collect, classify, compile and circulate Policy related circulars, press releases and all relevant

information of use and interest to textile industry.


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The Madhya Pradesh T extile Mills Association

LIVE MEMBER MILLS

l Anant Spinning Mills , Mandideep – 462 046

l Bhaskar Industries Pvt. Ltd., Mandideep – 462 046

l Century Denim, Satrati – 451 660

l Century Yarn, Satrati – 451 660

l Deepak Spinners Ltd., Pagara – 473 001

l Dhar Textile Mills Ltd., Pithampur – 454 774

l Grasim Industries Ltd. (Staple Fibre Divn.), Birlagram, Nagda – 456 331

l Hind Syntex Limited, Pilukhedi - 465 667

l Jaideep India Pvt. Ltd., Pithampur - 454 774

l Kamal Cotspin Private Ltd. , Burhanpur - 450 331

l Kohinoor Elastics Pvt. Ltd., Indore-452 015.

l Madhumilan Industries Ltd., (Spinning Divn.), Talawada - 465 674

l Mahima Purespun, Pithampur - 454 774

l Maral Overseas Ltd., Maral Sarovar – 451 660

l Mohini Fibers Pvt. Ltd., Pithampur - 454 774.

l Nahar Spinning Mills Ltd., Mandideep - 464 993

l National Textile Corporation Ltd., Indore

m Burhanpur Tapti Mills , Burhanpur – 450 331

m New Bhopal Textile Mills , Bhopal – 462 010

l PBM Polytex Ltd., Boregaon - 480 106

l Pratibha Syntex Ltd., Pithampur - 454 774

l Prem Textiles (International) Pvt. Ltd., Indore – 452 015

l Ramesh Textiles India Pvt. Ltd., Indore – 452 015

l Raymond Limited., Kailash Nagar - 480 106

l Ritspin Synthetics Ltd., Pithampur - 454 774

l Sagar Manufacturers Pvt. Ltd., Tamot – 464 993.

l Satyam Spinners Pvt.Ltd., Sendhwa - 451 666

l SEL Manufacturing Co. Ltd., Mehatwara – 466 118

l Sheshadri Industries Ltd., Rajna – 480 340

l S. Kumars Ltd., Dewas- 455 001

l Spentex Industries Ltd., Pithampur - 454 774

l S R F Limited, Malanpur - 477 116

l STI India Ltd., Rau – 453 332

l Swastik Spintex Ltd , Rajoda – 453 562

l Vardhman Fabrics, Pilikarar, Talpura, Budhni – 466 441

l Vardhman Yarns, Satlapur , Mandideep – 462 046

l Vikram Woollens, Malanpur - 477 117

l Vippy Spinpro Ltd., Dewas - 455 001

l Wearit Global Ltd., Bheelgaon – 451 228


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THE YEAR UNDER REPORT

BACKGROUND:

This Association was established in 1932 as Indore Mill Owners’ Association by Shri Rao Raja Sir Seth Hukamchand. Atthe time of its establishment, the Association had seven composite textile mills from Indore as members. After themerger of various States of Gwalior, Indore and Malwa in May 1948, the name of the Association was changed from 6th

August, 1948 as Madhya Bharat Millowners’ Association and the mills in the region were invited to join . With theformation of the State of Madhya Pradesh on 1st November, 1956 integrating, among others, the State of Madhya Bharat,the name of the Association was changed to reflect its regional character and Madhya Pradesh Millowners’ Associationcame into being from 1st January, 1957. It was registered under the Madhya Pradesh Non-Trading Corporations Act,1962 on 1st June, 1966 after being renamed as The Madhya Pradesh Textile Mills’ Association w.e.f. 1st January, 1966.

The Association’ is committed to the growth of Textile Industry in the State. It also acts as an effective link between theTextile Industry in the State and the Central / State Governments, Confederation of Indian Textile Industry, and variousChambers, Associations and Organizations.

MEMBERSHIP :

The Association has thirtyeight Mills as its live Members. Services to CT Cotton Yarn Ltd., Mid India International Ltd,Jyoti Overseas Ltd., Chhabra Spinners Pvt. Ltd., Harshit Textiles Pvt. Ltd., Kokila Texpro Pvt. Ltd., Chamunda StandardMills, S.Kumars (Nationwide) Ltd., Agrawal Indotex Ltd., Texpert International and Parasrampuria International havebeen kept under suspension under Articles 4.11 of the Articles of Association.

OFFICE BEARERS :

The Annual General Meeting of the Association for the year 2014-15 was held on 23rd January, 2016 andthe following office bearers were elected for the term 2015-16 :

* Shri Piyush Mutha, ChairmanManaging Director,Vippy Spinpro Ltd.,Dewas.

* Shri Akhilesh Rathi, Vice ChairmanDirector,Bhaskar Industries Pvt.Ltd.,Mandideep.

* Shri Suresh Maheshwari, Deputy ChairmanPresident,Maral Overseas Ltd.,Maral Sarovar.

* Shri Shreyaskar Chaudhary , Deputy ChairmanManaging Director,Pratibha Syntex Ltd.,Pithampur.


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MANAGING COMMITTEE :As per Article 6.4 of the Articles of Association, the new Managing Committee was constituted at the Annual GeneralMeeting held on 23rd January, 2016. Certain nominations were changed by Member Mills later and some new Memberswere enrolled. The present nominees on the Managing Committee are as under :-

Name of Member-Mill Principal AlternateRepresentative Representative

Anant Spinning Mills Shri S. Pal Shri R. S. Yadav

Bhaskar Industries Pvt.Ltd. Shri Akhilesh Rathi Shri Sandeep Baheti

Century Denim Shri Jagir Singh Shri Manish Naraniwal

Century Yarn Shri Jagir Singh Shri Manish Naraniwal

Deepak Spinners Ltd. Shri S. B. Sharda Shri A. K. Gupta

Dhar Textile Mills Ltd. Shri Pankaj Jajoo Shri Laxminarayan Kasera

Grasim Industries Ltd (SFD) Shri Naveen Mittal Shri Ravindra Chaudhary

Hind Syntex Ltd. Shri Hemant Ambekar Shri R. O. Sharma

Jaideep India Pvt. Ltd. Shri N. K. Agrawal Shri Vinay Agrawal

Kamal Cotspin Pvt. Ltd. Shri Ankit Lath Shri Kamal Lath

Kohinoor Elastics Pvt.Ltd. Shri Rajendra Matlani

Madhumilan Industries Ltd. Shri A.K. Chaudhary Shri Kanak Jain

Mahima Purespun Shri Rohit Doshi Shri Ashish Doshi

Maral Overseas Ltd. Shri Suresh Maheshwari Shri Rajkumar Gite

Mohini Fibers Pvt. Ltd. Shri Sarvapriya Bansal Shri Snehakar Bansal

Nahar Spinning Mills Ltd. Shri D. K. Mundra Shri Surender Bhatt

National Textile Corpn. Ltd. Shri A. Sukumar Shri R. K. Dubey orShri M.S. Dhaka

PBM Polytex Ltd. Shri K. K. Patodia Shri Vijay Sharma

Pratibha Syntex Ltd. Shri Shreyaskar Choudhary Shri Ashok Jain

Prem Textiles (Int) Pvt. Ltd. Shri S. C. Jain Shri Saurabh Jain

Ramesh Textile India Pvt. Ltd. Shri Ramesh Samria Shri Sanjay Samria

Raymond Limited Shri Vinod Padmanabhan Shri Ashish Dubey

Ritspin Synthetics Ltd. Shri Manish Kumar Shri Vilas Agrawal

Sagar Manufacturers Pvt.Ltd. Shri Siddarth Agrawal Shri V. K. Jain

Satyam Spinners Pvt. Ltd. Shri Chetan Kumar Agrawal Shri P. K. Roul

SEL Manufacturing Co.Ltd. Shri Anchal Kumar Shri R. K. Singh

Sheshadri Industries Ltd. Shri J. K. Agarwal Shri Shantanu Dey

S. Kumars Ltd. Shri R. K. Mehta Shri G. D. Bansal

Spentex Industries Ltd. Shri L. N. Kaushik Shri Manish Gupta

SRF Ltd. Shri Sanjeev S. Tipnis Shri Rajesh Sharma

STI India Ltd. Shri A. Sarkar Shri Mukesh Maheshwari

Swastik Spintex Ltd. Shri V. K. Rathi Shri G. D. Rathi

Vardhman Yarns Shri S. Pal Shri Praveen Dhingra

Vardhman Fabrics Shri T. C. Gupta Shri Arvind Gupta

Vikram Woollens Shri Man Mohan Singh Shri Santosh Kumar Singh

Vippy Spinpro Ltd. Shri Piyush K. Mutha Shri Ashwani Kamra

Wearit Global Ltd. Shri Randheer Rana Shri B. S. Suryawanshi


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COMMITTEE MEETINGS :During the year 2015-16, four Managing Committee Meetings were held. The Minutes of the Meetings were circulatedand timely action was taken to give effect to the decisions of the Committee.

ANNUAL SUBSCRIPTION :The Annual Subscription rates for 2016-17 are kept unchanged .

MEMBERSHIP OF THE OTHER INDUSTRY FORUMS :

The Association continued to be the Member of the following Bodies :l Confederation of Indian Textile Industry, New Delhi.l Textile Sector Skill Council, New Delhi.l Federation of Indian Chambers of Commerce & Industry, New Delhi.l All India Organization of Employers, New Delhi.l Associated Chambers of Commerce & Industry of India, New Delhi.l Electricity Consumers’ Society, Indore.l Federation of M.P.Chambers of Commerce & Industry, Bhopal.l Indore Management Association, Indore.

REPRESENTATION AT ALL INDIA/ STATE LEVEL BODIES:Our representation (direct/indirect) at various Bodies during the year 2015-16 has been as under:-

Name of the Body Name of the Representative

* Confederation of Indian Textile IndustryPrincipal Representative - Shri Manish Kumar, Ritspin Synthetics Ltd.Alternate Representative - Shri Akhilesh Rathi, Bhaskar Industries Pvt. Ltd.

* Federation of Indian Chambers ofCommerce & Industry - Chairman, MPTMA

* Textile Sector Skill Council - Shri Manish Kumar, Ritspin Synthetics Ltd.

* Associated Chamber of Commerce & Industryof India - Chairman, MPTMA

* Federation of MP Chambers of Commerce &Industry - Chairman, MPTMA

* M. P. Labour Advisory Board - Shri S.Pal, Vardhman Group.

* M. P. Labour Welfare Board - Shri S. Pal, Vardhman Group.

* M. P. Minimum Wage Advisory Board - Shri Suresh Maheshwari, Deputy Chairman

* Divisional Advisory Committee of M. P.Labour Welfare Board Indore Division - Shri P. D. Sharma, Pratibha Syntex Ltd. Bhopal Division - Shri S. Pal, Vardhman Group

* M.P.State Advisory Board for Contract Labour - Shri S. Pal, Vardhman Group

* Regional Advisory Committee of ESI - Shri Suresh Maheshwari, Deputy Chairman

* Provident Fund Regional Advisory Committee,Indore - Shri M. C. Rawat, Secretary

* Electricity Consumers’ Society:Executive Committee - Shri Laxminarayan Kasera, Dhar Textile Mills Ltd.

- Shri M. C. Rawat, Secretary


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* Indore Management Association - Shri Laxminarayan Kasera, Dhar Textile Mills Ltd.- Shri M. C. Rawat, Secretary

* Indore Railway Station Advisory Committee - Shri Laxminarayan Kasera, Dhar Textile Mills Ltd.

* Shri Ahilyamata Gaushala Jeev Daya - Shri Laxminarayan Kasera, Dhar Textile Mills Ltd.Mandal / Trust. - Shri M. C. Rawat, Secretary

REPRESENTATION AT COMMITTEES :* The State Government nominated Shri S. P. Oswal, Chairman, Vardhman Group and Shri S. K. Chaudhary,

Chairman, Pratibha Syntex Ltd., on State Level Industry Advisory Committee.

REPRESENTATIONS TO THE GOVERNMENTS :During the year under Report, the Association submitted a number of Representations to the Central/State Governmentsand other authorities on various subjects, which have been dealt within relevant parts of this Report. However, thefollowing representations need special mention :-

1) COMMENTS ON DRAFT LABOUR CODE ON INDUSTRIAL RELATIONS :The Ministry of Labour & Employment, Government of India, issued Draft Labour Code on Industrial Relations,which is proposed to be made after amalgamation of following Labour Laws :-

l Trade Unions Act, 1926.

l Industrial Employment (Standing Orders) Act, 1946.

l Industrial Disputes Act, 1947.

The Ministry invited suggestions from various stakeholders on this Draft Code, so as to reach them latest by 26th

May, 2015. The copy of this Draft Code was circulated to our Member Mills as well as to the other Industry Associationsin the area, so as to obtain their views on the contents of the Bill.

Few of the changes proposed in the Bill included the following :-

l Definition of ‘Industry’ has been widened to include even ventures without profit motive and without any capitalinvestment.

l Compensation to be paid to employees on restructuring increased from existing 15 days salary for each completedyear of service to 45 days salary for each completed year of service.

l For strike/lockout notice of six weeks introduced for the first time. If 50% or more persons apply for leave, it willbe deemed as strike.

l Atleast 10% employees should be member of a trade union applying for registration. Where the number exceeds100, the application for registration should be signed by 100 members.

l Go slow has been listed in the activities of misconduct.

The Association had detailed deliberation on the subject with its Members, other Association Representatives andthe Legal Advisor on 18th May, 2015 and section-wise comments/ suggestions were forwarded to the Ministry on 21st

May, 2015.

2) REPRESENTATION ON ELECTRICITY MATTERS :The Association made representations on 8th May, 2015 to the Hon’ble Chief Minister, Commerce & Industry Minister,Energy Minister of the State and Union Minister of State for Power highlighting the following issues in respect ofElectricity Tariff for 2015-16 notified by the Madhya Pradesh Electricity Regulatory Commission on 17th April, 2015:-

l Deliberate delay by DISCOMs in calculating voltage-wise cost of supply, despite orders of MPERC dated 25th

October, 2013.

l Non-following of Road Map to Reduction in Cross-Subsidy, despite orders of Regulatory Commission dated 6th

October, 2007.

l Non-assessment of realistic losses due to non-appointment of independent consultants.


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3) TECHNICAL TEXTILE UNITS TO BE CONSIDERED AS COMPOSITE MILLS BY STATE :The Industrial Promotion Policy, 2014 and Action Plan provides for certain fiscal assistance – Special Textile Package.Technical Textile Units are a part of textile sector. However, in the Policy these have been treated as standaloneunits and not as composite textile mills. Para 10.11.2 of the Policy provides that a unit to be classified as compositeunit should be doing either of the two processes (weaving/knitting and processing; processing and garmenting;spinning, weaving/knitting – processing and garmenting). This para further provides that to be classified as compositeunit, atleast 75% of primary produce should be used as input for downstream activities. Since the technical textileunits utilize more than 75% of their primary produce (bleached, combed cotton/other fibres as inputs), which shouldbe for downstream activities, i.e., final produce. We, therefore, requested on 23rd November, 2015, the Hon’ble ChiefMinister and Minister of Commerce, Industry & Employment with copies to Principal Secretary, Finance, PrincipalSecretary, Department of Commerce & Industry, Managing Director, TRIFAC and Industries Commissioner to treattechnical textile units as composite units for sanction of financial assistance under the Policy. The matter wasexplained to the Managing Director, TRIFAC and Adl. Secretary, Department of Industries on 8th December, 2015.

4) REPRESENTATION ON SIMPLIFICATION OF LABOUR LA WS :The Labour Commissioner of the State vide its Circular dated 9th February, 2016, invited suggestions for Simplificationof Labour Laws in the State and also called a meeting for discussion of suggestions on 18th February, 2016. TheAssociation made the following suggestions :-

l The rate of variable Dearness Allowance being paid alongwith minimum wages should be reasonably reducedfrom Rs.25 per point at par with other States.

l The Labour Courts be permitted to hear the petitions in respect of labour cases, which have been presently heardby Judicial Magistrates.

l A time limit be fixed for settlement of labour cases before Concilation Officers.

l Textile Industry be declared Public Utility Service under the Industrial Disputes Act.

l No separate permission should be required from Municipal Corporation/AKVN for Construction/Expansion ofBuilding under Factories Act.

l Medical Officers of ESIC be advised for health checkup of workers under Factories Act.

l In case of accidents in a factory, the employer should not be prosecuted under Indian Penal Code as prosecutionis being done under Factories Act.

l Provision should be made to penalize workmen who do not use/adhere to safety measures provided by theemployer.

l Carrying of mobile phones on workplace be banned.

l Building and Other Construction Workers Welfare Cess should not be recovered from factories as this law doesnot apply to establishments registered under Factories Act.

l Contractors should be made responsible for defying provisions of various labour laws instead of holding thefactory management responsible for the same.

l Some comprehensive formats/registers should be prescribed in place of around 65 registers and returns presentlybeing maintained/submitted.

At the Meeting held in the office of Labour Commissioner, the above points were explained in detail by our DeputyChairman, Shri Suresh Maheshwari.

5) PRE-BUDGET MEMORANDUM TO STATE GOVERNMENT :The Association has submitted a Pre-Budget Memorandum 2016-17 to the Finance Minister of the State on 11th

January, 2016 requesting to include the following in its Budget Proposals :-

l Reduction in rate of VAT on all types of yarn/yarn waste from 5% to 2%.

l To include cotton waste under Section 26-A(1) of MP VAT Act.

l Exemption of cotton and fabric from provisions of Form-49.

l Exemption of garments for exports from provisions of Form-49.

l To review the provisions of penalty under Section 57 of MP VAT Act.


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l To make provisions for revision of Tax Returns under MP VAT Act by making provisions similar to provisions underIncome Tax Act.

l To reduce Entry Tax on coal used for captive power generation from 3% to 1%; or allow set of tax over 1%.

l Reduction in rate of Electricity Duty payable on captive generation from 15% to 9%.

l To exempt purchase of power under open access from levy of Electricity Duty and Energy Development Cess.

These proposals were explained in detail to the Hon’ble Finance Minister by the Chairman and Dy. Chairman in theMeeting held on 3rd February, 2016.

VISIT OF USDA AUTHORITIES :Shri Dhruv Sood, Agricultural Specialist, United States Department of Agriculture, Foreign Agriculture Service, was inMadhya Pradesh to assess the production of cotton and its likely consumption in the cotton year 2016-17 (July-June).He visited our office on 17th February, 2016 and collected information in respect of production and consumption of cottonin the State during 2015-16 and expectations for 2016-17.

EVALUATION OF BUDGETS 2016-17 :Our Association jointly with the Textile Association (India), M. P. Unit, Spinners Club and Madhya Pradesh Mill StoresMerchants Association organized on 1st March, 2016 a talk on Union Budget 2016-17. The Speakers included Dr.Jayantilal Bhandari, Economist, Dr. Kamlesh Bhandari, Economist, CA Shri Subhash Deshpande, CA Shri Sunil Jainand CS Shri Ajit Jain.

Dr. Jayantilal Bhandari was of the view that this Budget would give a new direction to the agriculture and rural developmentin the Country. CA Shri Subhash Deshpande highlighted various amendments made to the direct tax provisions, whichincluded amendmnent to Section 80 JJ AA, Accelerated Depreciation, Deduction for Research & Development, etc. CAShri Sunil Jain explained provisions relating to amendment in Service Tax Regulations and CENVAT Credit Rules. Dr.Kamlesh Bhandari was critical of the Budget provisions and stated that nothing has been provided for 97% of the taxpayers. Simply extending benefit of tax rebate under Section 87A from Rs. 2000 to Rs. 5000 for tax payers with incomeupto Rs. Five Lakh and increasing the limit of deduction of rent paid under Section 80 GG from Rs. 24000 per annum toRs. 60000 per annum will not make much difference for those who live in rented houses. CS Shri Ajit Jain spoke aboutthe impact of Budget on the Stock Market. Lastly Shri M. C. Rawat, Secretary of the Association highlighted the variousprovisions in the Central and State Budgets relating to Textile Industry in particular and proposed vote of thanks.

SEMINAR ON COTTON HEDGING :A Seminar on ‘Hedging on Cotton’ was organized on 11th December, 2015 by the Association with Multi CommodityExchange of India Limited, Mumbai. Ms. Daxa Jani of MCX made power point presentation on the subject providingglobal and domestic outlook, cotton contract specifications, cotton prices and stocks, needs of hedging, hedgingstrategies, etc. The reasons for going for MCX cotton contracts were specified as under :-

l Contract designed and regularly monitored by panel of National and Regional Product Advisory Committees.

l Vide derivable range – 27 mm to 31 mm with 29 mm as base grade.

l Six delivery centres : Rajkot, Kadi, Jalgaon, Jalna, Yavatmal and Sirsa.

l High Co-relation with Spot Prices at Rajkot.

l High Co-relation with prices at Benchmark International Exchanges in USA (ICE) and China (ZCE).

The need to hedge cotton is for the following reasons :-

l Larger the purchase, larger the price risk.

l Even in hand to mouth situation, price risk remain, as the price of finished product cannot be changed frequently.

l Volatility could be used to advantage by using Futures for locking in best prices.

l Hedging mechanism helps in efficient credit management and improves stability in profit.

After the presentation, the programme was followed by question answer session. The queries of the participants wereanswered to their satisfaction by Ms. Daxa. About 15 Representatives from Member Mills attended the programme.


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REGIONAL OFFICE OF TEXTILE COMMISSIONER :The Regional Office of Textile Commissioner with jurisdiction of the States of Madhya Pradesh and Chattisgarh isfunctioning from Corporate Block, RMG Complex, Pardeshipura, Indore.

AUDITORS :M/s. R. D. Asawa & Co., Chartered Accountants, were appointed as Auditors for the financial year 2015-16.

MONTHLY NEWSLETTER :Publication of M.P.TEXTILE NEWSLETTER, monthly newsletter of the Association, which is being published regularlysince September, 1993 and circulated to all the Members, Ministers, Central and State Government Officials, variousIndustry Chambers, Associations, etc., continued during the year.

DIRECTORY OF MEMBERS :The DIRECTORY-2016 of Member-Mills was published in March, 2016 and circulated.

ACKNOWLEDGEMENTS :Association wishes to express its gratitude to the Hon’ble Chief Minister, other Cabinet Ministers and Senior Officialsin the various Ministries/Departments for their co-operation and advices.

The Association is also greateful to the Confederation of Indian Textile Industry, Federation of Indian Chamber of Commerce& Industry, All India Organisation of Employers, Electricity Consumers’ Society, other Industry Associations andorganizations for their continued support in and resolving problems of the Industry. Association is also thankful to theprint media for highlighting its problems/views on various subjects from time to time.

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RAW MATERIAL

Diverse range of fibres, which include Cotton, Man-made fibres, Wool, Silk, other miscellaneous fibres and filamentsare consumed by our Textile Industry. The consumption of fibres other than natural fibres is on the rise. The ratio of useof cotton is roughly 70% and pre-dominantly the industry remains cotton based. India currently has an annual productionof over 6 million tons of cotton, 22 million kilos of silk, 44 million kilos of wool and 2.63 million tons of man-made fibre/filaments, which represent 28% of World production in cotton, 16% in silk, 2% in wool and 5% in man-made fibresglobally.

NATIONAL FIBRE SCENARIO :Cotton plays a vital role in the growth of manufacturing activity, exports and employment in our Country. Close to 65%of textile production and over 75% of textile exports from the Country are linked to cotton. It is a major raw material forthe domestic textile industry and provides sustenance to millions of farmers and contributes significantly to Country’sexport earnings. The consumption pattern of cotton and other fibres from 2011-12 to 2015-16 is given below :-

Quantity in Million Kgs .

Fibre 2011-12 2012-13 2013-14 2014-15 2015-16

Qty. % Qty. % Qty. % Qty. % Qty %

Cotton 3972 62.33 4473 67.08 4866 70.12 5087 70.89 5124 72.35

Polyester Staple Fibre 704 11.04 697 10.45 691 9.96 782 10.90 811 11.46

Viscose Staple Fibre 246 3.86 258 3.87 278 4.00 258 3.60 219 3.09

Acrylic Staple Fibre 86 1.35 96 1.44 113 1.63 101 1.40 114 1.60

Polypropylene Staple Fibre 4 0.06 2 0.03 0 0.00 0 0.00 0 0.00

Polyster Filament Yarn 1106 17.35 934 14.01 773 11.15 715 9.96 571 8.06

Viscose Filament Yarn 45 0.70 46 0.70 53 0.76 53 0.74 51 0.72

Nylon Filament Yarn 32 0.50 23 0.34 24 0.35 33 0.46 38 0.54

Polypropylene Filament Yarn 14 0.22 17 0.25 12 0.17 11 0.15 11 0.16

Others (Silk, Wool, etc.) 165 2.59 122 1.83 129 1.86 136 1.90 143 2.02

Total 6374 100.00 6668 100.00 6939 100.00 7176 100.00 7082 100.00

NATIONAL FIBRE POLICY :The National Fibre Policy, which seeks to place India firmly on the World Fibre Map by strengthening the existing policyframe work and providing institutional and technological support for rapid fibre growth in the Country was put on thewebsite by the Textile Ministry on 11th April, 2012. The Union Minister of State for Textiles informed Lok Sabha on 29th

April, 2013, that recommendations of the Policy have been incorporated in the 12th Five Year Plan with specific financingprovisions. This Policy has been designed with perspective of 2010-20 and seeks to balance the existing disparitieswithin the complete range of fibres by providing additional fiscal and non-fiscal incentives for sustainable growth of allfibres.

COTTON SCENARIO :The total geographical area of the Country is 328.7 million hectares, of which 141.6 milllion hectares is net sown area.Out of this sown area of 141.6 million hectares, around 12 million hectares is used for cotton sowing. The acreage undercotton has increased by about 45% during the period 2001-02 to 2014-15. India has the largest acreage under cotton,which constitutes around 35% of World’s total cotton acreage, but the share in cotton production is only about 28%.


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AREA UNDER COTTON, PRODUCTION AND YIELD :The year-wise Area under cotton, Production Consumption, Import, Export and Yield for the years 2005-06 to 2015-16are given in the following table :-

Cotton year Area Production Yield Cotton Consumption by Import Export(Oct to Sep) (Lakh Hect.) (Lakh Bales) (Kgs./Hec) Mills (Lakh Bales) (Lakh Bales) (Lakh Bales)

(As per CAB) Non SSI SSI

2005-06 86.77 241.00 472 180.09 18.85 5.01 47.00

2006-07 91.42 280.00 520 194.89 21.26 5.54 58.00

2007-08 94.14 307.00 554 195.67 22.07 6.38 88.50

2008-09 94.06 290.00 524 195.00 20.22 8.91 35.00

2009-10 103.10 305.00 503 219.00 22.72 5.37 83.00

2010-11 112.35 339.00 517 221.77 24.46 2.45 76.50

2011-12 121.78 353.00 496 217.68 22.10 4.54 128.81

2012-13 119.78 365.00 518 250.14 23.02 14.59 101.43

2013-14 119.60 398.00 566 266.00 24.88 11.51 116.96

2014-15 128.46 386.00 511 278.55 26.28 14.39 57.72

2015-16(E) 119.10 338.00 482 274.00 24.00 15.00 68.00

The Cotton production during 2014-15 decreased by 3.02%, whereas during 2015-16 it is expected to fall by 12.43%.The cotton yield is far lower than global average, despite being largest cotton producing nation of the World. Ourproductivity is around 500 Kgs. compared to World average of around 800 Kgs. per hectare.

Cotton Yield :Production and productivity of Cotton of India have made remarkable strides during the last decade. Gujarat, Maharashtra,Andhra Pradesh and Madhya Pradesh have been in fore-front of cotton production in the Country. The productivity inmajor cotton producing States and at all India level is shown in the following table :-

Kgs. per HectareYear Punjab Gujarat Maharashtra Andhra Madhya All India

Pradesh Pradesh

2005-06 610 794 213 527 521 478

2006-07 672 733 274 630 505 520

2007-08 563 772 330 690 539 554

2008-09 565 650 336 644 490 524

2009-10 432 635 319 628 424 503

2010-11 593 686 379 538 463 513

2011-12 607 700 313 542 433 512

2012-13 744 633 324 595 531 518

2013-14 800 837 341 555 628 566

2014-15 526 687 324 548* 563 511

2015-16(E) 320 588 333 615 559 482

*Note – From 2014-15 the figures are for new Andhra Pradesh (excluding Telengana).


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It would be observed that India recorded highest yield of 566 Kgs. in 2013-14. During the year 2014-15 and 2015-16yield and cotton production in Punjab, Gujarat and Maharashtra were affected due to drought and attack by white fly.

Cotton Advisory Board :The Cotton Advisory Board was reconstituted on 28th January, 2015 for a period of two years. Its composition includedTextile Commissioner as Chairman and 18 Members from Central Government, Cotton Trade, and Cotton ResearchInstitutions. Cotton Consultative Committee consisting of Textile Commissioner as Chairman and 39 Members fromCentral Government, State Governments, Textile Industry, Cotton Trade, Ginning and Pressing Sector, Cotton SeedManufacturers, etc., was also constituted.The Meeting of the Board was held on 13th July, 2016, whereat Cotton Balance Sheet for 2014-15 and 2015-16 weredrawn, comparative Cotton Balance Sheet for last five years is as under :-

Quantity in Lakh Bales of 170 Kgs. each

2011-12 2012-13 2013-14 2014-15 2015-16

Supply :

Opening Stock 45.77 40.00 40.00 33.00 66.00

Production : 367.00 370.00 398.00 386.00 338.00

Imports 7.51 14.59 11.51 14.39 15.00

Total 420.28 424.59 449.51 433.39 419.00

Demand :

Consumption : Mills 223.59 251.74 268.03 278.55 274.00

SSI Units 22.12 23.59 25.20 26.28 24.00

Non-Mill 5.00 7.83 6.32 4.84 10.00

Exports 129.57 101.43 116.96 57.72 68.00

Total 380.28 384.59 416.51 367.39 376.00

Closing Stock 40.00 40.00 33.00 66.00 43.00

However, the Cotton Association of India has estimated cotton production during 2015-16 at 341.50 lakh bales(30th April, 2016).

GROWTH OF MAN-MADE FIBRES :The man-made fibre industry (synthetic and cellulose) in India has not experienced rapid growth as in other Countriesdue to Government Policy, skewed towards natural fibres. Indian MMF production is competitive relative to other majorproducing countries like China, where energy and labour costs are on the rise. Our MMF Sector also suffers from somepractices of domestic producers, such as import parity pricing and calibrating production to influence price trends.Removal of custom duties and/or atleast substancial reduction in excise duties both on MMF and its raw material maystrengthen this industry.Installed capacity, production, imports/exports and consumption of man-made fibres during the period 2008-09 to 2015-16 have been as under :-

Quantity in Million Kgs.

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

Viscose Fibre

Installed capacity 418.68 418.68 418.68 418.68 418.68 418.68 418.68 418.68

Production 232.75 302.09 305.09 322.63 337.49 361.01 365.15 341.90

Import 10.98 18.71 14.07 21.41 15.36 18.38 27.33 33.91

Export 28.39 59.44 56.24 78.58 99.53 107.15 125.77 158.51

Consumption 221.06 267.71 262.49 245.72 257.42 278.22 257.57 218.92


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Polyster Fibre


Production 750.11 872.13 896.33 829.74 848.04 845.95 881.56 893.95

Import 16.48 14.42 31.55 44.68 29.67 42.63 81.86 104.74

Export 136.37 160.83 162.38 176.00 170.32 205.34 183.58 181.57

Consumption 653.48 726.42 756.22 704.07 697.39 690.87 781.68 811.32

Acrylic Staple Fibre


Production 79.51 90.45 79.47 77.70 73.60 96.11 92.54 106.79

Import 10.61 10.75 21.43 19.58 28.78 32.16 31.84 35.83

Export 1.60 5.78 25.23 15.22 6.75 16.32 20.79 30.67

Consumption 88.72 96.08 69.48 85.85 96.14 113.47 100.86 113.70

Polypropylene Staple Fibre


Production 3.43 3.37 3.75 4.08 4.26 3.71 4.62 4.71

Import 0.12 0.15 0.12 0.34 0.34 0.40 0.33 2.01

Export 0.89 0.50 0.57 0.57 2.30 14.89 10.61 7.93

Consumption 2.57 3.10 3.26 3.89 2.22 - - -

AVAILABILITY OF RAW WOOL & IMPORTS :Indigenous production of fine quality wool required by the organized mill sector and decentralized hosiery sector is verylimited and for fine quality wool, mills have to depend on imports mainly from Australia and New Zealand. The productionand import of raw wool, etc., from 2004-05 is given below :-

Quantity in Million Kgs .

Year Production of Imports

Indigenous Wool Raw Wool Woollen & Cotton Rags

2004-05 44.60 84.75 73.61

2005-06 44.90 90.19 124.97

2006-07 45.20 99.62 110.26

2007-08 45.00 93.08 91.81

2008-09 48.00 65.70 85.30

2009-10 43.22 68.26 82.80

2010-11 42.99 94.77 95.55

2011-12 44.73 76.29 140.52

2012-13 46.05 77.16 186.38

2013-14 47.90 89.60 187.53

2014-15 48.10 96.53 222.86

INTERNATIONAL SCENARIO :COTTON – PRODUCTION AND CONSUMPTION :Globally cotton continues to be major fibre for consumption. It accounts for 53% of total fibre consumption, whilesynthetic and cellulose fibres account for 37% and 10% each of global consumption.There are 60 Countries in the World that grow cotton of which the number that produce a significant quantity of 10000tons and above is about 50. The countries that can be the leading ones are China, India, U.S.A., Pakistan and Brazil.


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The ICAC has projected on 1st June, 2016 World Cotton Production and Consumption for the years estimates for2014-15 and projections for 2015-16 and 2016-17. The comparative data since 2011-12 is given in the following table:-

Quantity in Million T ons

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17

Opening Stock 10.13 15.35 18.32 20.49 22.22 20.38

Production 27.83 26.80 26.19 26.12 21.81 23.01

Consumption 22.78 23.53 23.76 24.33 23.65 23.73

Ending Stocks 15.35 18.32 20.49 22.22 20.38 19.66

Cotlook A. Index 100 88 91 71 70 70

World Cotton Production and Consumption of major cotton producing countries during 2011-12 to 2015-16 as reportedby ICAC is as under :-

Quantity in Thousand T ons

Country 2011-12 2012-13 2013-14 2014-15 2015-16

Prod. Cons. Prod. Cons. Prod. Cons. Prod. Cons. Prod. Cons.

China 7400 8635 7300 8290 6929 7517 6480 7700 5170 7080

India 6239 4231 6290 4731 6765 5057 6460 5270 5880 5230

USA 3391 718 3770 762 2811 773 3553 810 2810 780

Pakistan 2311 2121 2002 2216 2076 2470 2305 2310 1510 2190

Brazil 1877 897 1310 910 1734 880 1563 850 1440 760

Others 6621 6182 6128 6622 5870 7065 5755 7110 5000 7610

World Total 27839 22784 26800 23531 26185 23762 26116 24050 21810 23650

Other major consumers include EU, Turkey, Vietnam, Bangladesh, etc.The area under cotton in India is largest in the World. As per USDA Report, India has overtaken China as the World’slargest cotton producer (India’s share in 2015-16 World cotton production is 28% as against China’s 23%).

WORLD FIBRE PRODUCTION :The following table shows fibre-wise production of major textile items in the World in the year 2014-15 and status ofIndia :-


Textile Fibres India World India’s Share India’s Rank First Rank & Share in %

Jute 1650 3000 55% I India (55%)

Cotton 6096 22111 28% I India (28%)

Silk 28.7 178 16% II China (73%)

Wool 10.3 479 2% IX Australia (25.7%)

Cellulosic Fibres/filaments 409 5000 8.20% III China (65%)

Synthetic Fibres/filaments 2181 51000 4.30% II China (70%)


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STATE SCENARIO :COTTON PRODUCTION :Madhya Pradesh is growing cotton specially in Khandwa, Khargone, Barwani, Jhabua, Ratlam, and other areas. Thearea under cotton in Madhya Pradesh varies between 5 to 7 lakh hectares, and the production between 15 and 20 lakhbales. The area under cotton cultivation, the production of cotton and yield per hectare from 2005-06 to 2015-16 is givenhereunder :-

Year Area under cotton Production Yield(Kgs/Hectare)(In Lakh Hectares) (In Lakh Bales)

2005-06 6.20 19.00 5212006-07 6.39 19.00 5052007-08 6.30 20.00 5392008-09 6.25 18.00 4902009-10 6.11 15.25 4242010-11 6.50 17.70 4632011-12 7.06 18.00 4332012-13 6.08 19.00 5312013-14 5.14 19.00 6282014-15 5.74 19.00 5632015-16(E) 5.47 18.00 559

The yield data gives a very distorted figure because the production data includes cotton received from / sent to nearbyStates of Maharashtra, Gujarat, etc., for ginning and pressing on account of variation in rates of Mandi Tax on cotton,which is lower in neighbouring States.In our opinion the State Government should draw a crash programme, consisting of the following measures to increaseproduction and quality of cotton in the State :-l Earmark varieties of cotton for cultivation in State to encourage the growers to produce cotton needed by the

Industry, like Mech-1, DCH-32, H-4, S-6, LRA and MCU-5.l Provide expert advice to cotton growers through field visits of officers of Agriculture Department, and Scientists

from Agriculture Colleges/Universities.l Create awareness amongst cotton growers regarding modern and scientific cultivation practices and methodology

of keeping cotton free from contamination.l Encourage growing of Organic Cotton / Better Cotton Initiative (BCI).

The State Government should takeup Cotton Collaborative Project in Chhindwara, Ratlam and Dhar Districts as proposedby Cotton Development & Research Association of CITI and involve Ginning & Pressing Factories, Jawaharlal NehruKrishi Vishwavidyalay and Kisan Vikas Kendras for development of cotton production in the State.

PRODUCTION OF MAN-MADE FIBRE (VSF) :The only unit manufacturing Man-made fibre in the State (Grasim Industries Ltd.) has reported the production of ViscoseStaple Fibre as under :-

Year Production in ‘000 Kgs.2005-06 1,31,1112006-07 1,33,4612007-08 1,60,9172008-09 1,34,2072009-10 1,34,0392010-11 1,32,2042011-12 1,42,2582012-13 1,51,5282013-14 1,55,011 2014-15 1,53,6712015-16 1,27,656


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The production of Viscose Staple Fibre could have been much more, had the production activities at this plant notshutdown every year due non-availability of water in the summer season for 1½ to 2 months.

COTTON CONSUMPTION :Consumption of cotton by textile mills in the State since 2005-06 is as follows :-

Year Production in ‘000 Kgs.2005-06 1,58,8102006-07 1,76,1722007-08 1,82,8132008-09 2,02,7722009-10 2,50,6912010-11 2,78,4572011-12 3,09,9552012-13 3,48,4242013-14 3,88,4742014-15 4,33,521

The data in respect of consumption of Man-made fibre is not available separately for the State.

MINIMUM SUPPORT PRICE FOR KAPAS FOR 2015-16 AND 2016-17 :The Government of India announces the Minimum Support Price (MSP) for two basic varieties of cotton, viz. F-414/H-777/J-34 and H-4 of new crop seed cotton of fair average quality. Based on the support price for these two basic varietiesvis-à-vis the normal price differential and other relevant factors, the Textile Commissioner announces the support pricefor other varieties of kapas. The support prices announced by Textile Commissioner vide his Notification dated 2nd

September, 2016 for 2016-17 cotton season are as under :-

CLASS OF Fibre Quality Parameters Minimum Support Names of the indicative

COTTON Basic Staple Price (MSP) varieties used by the T rade Length (2.5% Micronaire Rs. per Qtl.Span Length) Value

in mm 2016-17 2015-16

(I) (II) (III) (IV) (V) (VI)

Short Staple (20 mm & below)

- 7.0-8.0 3360.00 3300.00 Assam Comilla

- 6.8-7.2 3360.00 3300.00 Bengal Deshi

Medium Staple (20.5 mm – 24.5 mm)

21.5-23.5 4.2-6.0 3610.00 3550.00 V-797/G.Cot.13/G.Cot.21

21.5-22.5 4.8-5.8 3660.00 3600.00 Jayadhar

23.5-24.5 3.4-5.5 3710.00 3650.00 AK/Y-1 (Mah & M.P.) /

MCU-7 (TN)/SVPR-2(TN)/

PCO-2(AP & Kar)/K-11 (TN)

Medium Long Staple (25.0 mm – 27.0 mm)

24.5-25.5 4.3-5.1 3860.00 3800.00 J-34 (Raj)

26.0-26.5 3.4-4.9 3960.00 3900.00 LRA-5166/KC-2(TN)

26.5-27.0 3.8-4.8 4010.00 3950.00 F-414/H-777/J-34 Hybrid


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Long Staple (27.5 mm – 32.0 mm)

27.5-28.5 4.0-4.8 4060.00 4000.00 F-414/H-777/J-34 Hybrid

27.5-28.5 3.5-4.7 4060.00 4000.00 H-4/H-6/MECH/RCH-2

27.5-29.0 3.6-4.8 4110.00 4050.00 Shankar-6/10

29.5-30.5 3.5-4.3 4160.00 4100.00 Bunny/Brahma

Extra Long Staple (32.5 mm & above)

32.5-33.5 3.2-4.3 4360.00 4300.00 MCU-5 / Surabhi

34.0-36.0 3.0-3.5 4560.00 4500.00 DCH-32

37.0-39.0 3.2-3.6 5360.00 5300.00 Suvin

The other terms and conditions specified in the Order were almost similar to those of the previous years.

COTTON PRICE TREND :It is said that if there is anything certain about Cotton prices, it is their uncertainty. This was demonstrated by behaviorof cotton prices during the year. The movement of prices (monthly average spot rates) of some of the major varietiesduring the year has been as under :-

Average Spot Rates : Rupees per Candy

Month J-34 SG Punjab Mech-1/H-4 S-6 (28 mm) DCH-32 (34/36 mm)(28 mm) MP Gujarat Karnat aka

2015-16 2014-15 2015-16 2014-15 2015-16 2014-15 2015-16 2014-15

April 34920 43960 34190 40947 36243 42636 46327 62017

May 36345 45531 35100 41957 35300 43394 46640 62927

June 36265 44791 34443 41552 35894 42775 46214 61365

July 36275 44507 33981 42220 34490 43184 46110 60815

August 35713 40990 33586 39703 34123 40393 45275 58650

September 36264 40186 33967 39460 35265 42245 46150 57105

October 33561 33330 32690 34440 32946 34270 47554 48000

November 32886 32384 32200 33170 32400 33150 46665 44190

December 33131 32985 32843 33369 33750 33337 47536 45950

January 33995 29418 33870 31970 34187 32043 50740 46142

February 33550 31600 32295 30960 33864 31000 51373 44300

March 33469 33053 33067 31882 33398 31733 50993 44870

April 34550 34920 34105 34190 35325 36243 50964 46327

Source : Indian Cotton Federation

Cotton markets are mainly influenced by three nations, China, the second largest producer (23%), consumer (29%)and importer (15%) followed by India and the US. India is the largest producer (28%), consumer (23%) and exporter(16%).


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OTHER RAW MATERIAL PRICES :The month end prices of various items of raw material during 2015-16 have been as under :-

Average Rates – Rs./Kg.

Month Cotton VSF PSF Raw MarinoRaw Medium Long Extra Long Wool Wool

(Wt.Avg.) 20.5-24.5 27.5-32.0 32.5 mm (Imported)mm mm & above

April’15 91.85 79.57 97.69 117.00 156.38 95.86 175.00 599.64

May 93.68 82.51 99.37 115.45 156.38 100.39 195.75 581.99

June 91.42 80.55 97.19 111.94 160.32 100.97 195.25 654.19

July 90.89 81.18 95.30 111.38 160.32 99.28 195.25 674.10

August 90.68 80.92 95.89 109.11 160.32 99.28 195.25 684.38

September 88.78 78.10 93.71 111.07 160.32 90.37 195.50 674.54

October 86.60 76.13 90.90 109.95 160.32 91.50 196.25 670.92

November 87.44 77.96 90.90 109.81 160.32 91.50 215.75 696.54

December 89.46 78.81 94.20 112.20 160.32 91.22 225.75 617.91

January’16 89.86 77.33 94.27 119.93 160.32 88.79 227.75 679.82

February 88.65 75.01 93.71 120.84 160.32 87.11 226.00 722.95

March 85.91 71.85 91.39 118.11 160.32 88.77 226.00 743.85

April 91.07 75.50 98.49 122.88 163.69 90.97 226.50 718.67

Source: Ministry of Textiles.

EXPORT OF COTTON :Registration requirement for export of cotton (Tariff Code 5201 and 5203) was dispensed with vide Notification dated 8th

December, 2014,.Export of Cotton (including waste) since 2005-06 has been as under :-

Year Quantity (T ons) Value Rs. Crore

2005-06 6,14,802 2,904.35

2006-07 11,62,217 6,107.81

2007-08 14,58,591 8,865.40

2008-09 4,57,562 2,865.83

2009-10 13,57,985 9,537.09

2010-11 12,58,443 12,979.93

2011-12 20,03,589 21,624.27

2012-13 20,14,783 19,812.98

2013-14 19,47,680 22,341.35

2014-15 11,42,529 11,642.64

2015-16 13,46,420 12,880.33


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CAB has estimated export of 68.00 lakh bales of Cotton during Cotton Season 2015-16 as against 57.72 lakh bales in2014-15. Cotton exports during 2014-15 have been lower by 49% as compared to 2013-14.Our Member Mills (those, who reported) exported cotton (including waste) during the last five years, details of which areas under :-

Year Value Rs. in Lakh

2010-11 813.21

2011-12 738.11

2012-13 296.66

2013-14 438.64

2014-15 68.69

ORGANIC COTTON :Organic Cotton is grown without use of any synthetically compounded chemicals (i.e., pesticides growth regulations,defoliants, etc.) and fertilizers. The demand for Organic Cotton is rising with people becoming more conscious forenvironment and health. The World production of Organic Cotton has risen from 610 tons in 2001 to 2,41,697 tons in2010. Organic Cotton is grown in 20 countries and is around 0.6% of global cotton production. Presently it is grown on350033 hectares of land and 193840 farmers are involved. The production has increased by around 10% in 2013-14 afterthree years of decline but showed a downfall of 3.8% in 2014-15. The top five organic cotton producing countries areIndia, China, Turkey, Tanzania and USA accounting for 96.78% of the total production. The World Organic Cottonproduction and demand have been as under :-

Year Production in T ons Demand in T ons

2004-05 25394 13610

2005-06 37799 25101

2006-07 57931 74839

2007-08 145872 92998

2008-09 209950 123272

2009-10 241697 N.A.

2010-11 151079 N.A.

2011-12 143600 N.A.

2012-13 106556 N.A.

2013-14 116974 N.A.

2014-15 112488 N.A.

According to Organic Cotton Market Report, 2014, Organic Cotton was grown in India on 1,72,295 hectares of land.Madhya Pradesh continued its significant leadership in terms of area (77735 hectares) followed by Maharashtra at31518 hectares and Odisha at 31178 hectares. Most of the Organic Cotton producing States showed a drop in acreage,the only big exception being Gujarat, which showed a significant upward trend. The average yield of Organic Cotton inIndia is 504 kgs. per hectare. However, this market is threatened due to cultivators selecting genetically modified hybridfor higher production. The reason being the elimination of synthetic fertilizers and pesticides use undoubtedly, a positiveenvironmental step, but an ultimately restrictive and expensive proposition. Organic Cotton production is reported to bedown by 13% in 2014-15 in India.


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The growth of Organic Cotton farming in India has been as under :-Year Quantity in T ons2005-2006 124832006-2007 187902007-2008 737022008-2009 1427662009-2010 1957572010-2011 1024522011-2012 1030042012-2013 81171

2013-2014 86853The advent of Better Cotton Initiative (BCI) and failure of Organic Cotton to give expected 10% higher price than conventionalcotton has led to reduction in area under organic cotton in India. It is believed that BCI will take a lead over organiccotton production.

BETTER COTTON INITIATIVE :The Annual Report of Better Cotton Initiative (BCI), a Switzerland based Not for Profit Organisation says Better Cottonnow makes up 7% of the national cotton production in India. 16,80,000 farmers were licensed Worldwide to sell BetterCotton in 2015, and they produced 18.64% of global cotton supply. Better Cotton is available in 21 cotton producingcountries after only six years of operations.Better Cotton is produced in 10 States in India and year-on-year figures for BCI Farmers, Better Cottton lint produced,and hectares under cultivation have increased dramatically.In 2015, the fifth harvest of Better Cotton in India was carried out by 3,81,993 BCI Farmers, producing 3,69,000 tons ofBetter Cotton lint on 5,92,000 hectares.A total of 18 Implementing Partners implemented Better Cotton projects during the 2015 harvest season, multiplyingtheir efforts to reach out to the larger demand for Better Cotton. The BCI Implementing Partners in India are: ACF(Ambuja Cement Foundation), AFPRO (Action for Food Production), Arvind, Cotton Connect, MYKAPS, Solidaridad,WWF-India, Abhishek Industries/Trident Group, Action for Social Advancement (ASA), Dilasa Janvikas Foundation,Mahima Fibres, PRDIS, Pratibha Syntex, Spectrum International, We Care Society, Deshpande Foundation, AnandiEcofarms and CAIM.

COLLECTION OF STATISTICS ACT, 2008 :Independent Cotton Ginning Factories, independent Cotton Pressing Factories and Cotton Ginning & Pressing Factories,Traders, Surgical Cotton or Cotton Wading Manufacturers and Cotton Textile Mills are required to submit to TextileCommissioner’s Office by 15th of succeeding month, monthly statistics relating to cotton as prescribed by the Ministryof Textiles vide Gazette Notification No. S.O. 7861 (E) dated 27th February, 2013 (published in Gazettee of India on 20th

March, 2013).

MANDI TAX ON COTTON :The State Government vide its Notification dated 30th November, 2010 reduced the rate of Mandi Tax applicable to un-ginned cotton brought in any Krishi Upaj Mandi either from within the State or from outside the State from Rs. 2 perRupees One hundred to Rs. 1 per Rupees One hundred for a period of one year. This Notification has been extendedupto 7th January, 2017.

WORKING CAPITAL FOR RAW MATERIAL :The Industry continues to pursue the matter regarding making available Working Capital Loans, at 7% p.a. interest with10% margin and for 9 months duration. Such a facility is a must for mills for purchasing and stocking cotton, during thecotton season, to reduce cost of production and make cost of our money globally competitive.

IMPORT OF COTTON AND OTHER FIBRES BY MEMBER-MILLS :Information relating to Import of Cotton and Other Fibres by Member-Mills during 2015-16 is given in Annexure-II.

CONSUMPTION OF COTTON AND OTHER FIBRES BY MEMBER MILLS :Details of Consumption of Cotton and Other Fibres by Member-Mills during 2015-16 are available in Annexure-III.

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INDUSTRY OVERVIEW

Our Textile Industry has an overwhelaing presence in the economic life of the Country. It is economic stalwart. Apartfrom providing one of the basic necessities of life, the textiles industry also plays a pivotal role through its contributionto industrial output, employment generation, and the export earnings of the Country. It contributes about 14% to themanufacturing sector, 5% to the GDP, and 14% to the Country’s export earnings. It provides direct employment to over45 million people and indirect employment to 55 million people, which include a substantial number of SC/ST, otherbackward classes and women. The Textile Sector is the second largest provider of employment after agriculture. Thus,the growth and all around development of this industry has a direct bearing on the improvement of national economy.

Our Textiles Industry includes both an “Organised” Sector (large scale spinning units and composite mills) and an“Unorganised” Sector (small scale spinning units, powerlooms, process houses, handlooms and hosiery units). Theclose linkage of the industry to agriculture and the ancient culture, and traditions of the Country make our textilessector unique in comparison with the textiles industry of other countries. This also provides, the industry with thecapacity to produce a variety of products suitable to the different market segments, both within and outside the Country.

Currently the Country’s textile market is estimated at more than US$ 100 billion (at market price), which is poised tobecome more than US$ 250 billion on or before 2025.

GROWTH PATTERN :The Index of Industrial Production (IIP) data covers two textile groups, namely textiles and wearing apparel. The followingIIP data for last five years show the growth pattern of the industry :-

Base Year 2011-12 2012-13 2013-14 2014-15 2015-162004-05 = 100Textiles 134.00 142.00 148.30 152.20 156.30

Growth (%) -1.40 5.97 4.43 2.62 2.60

Wearing Apparel 130.10 143.60 171.60 180.40 192.50

Growth (%) -8.51 10.38 19.50 5.42 6.70

NATIONAL TEXTILE POLICY :The Ministry of Textiles, vide its Resolution dated 17th June, 2013, constituted an Expert Committee under Chairmanshipof Shri Ajay Shankar, Member Secretary, National Manufacturing Competitiveness Council (NMCC) consisting of 24Members to review the National Textile Policy : 2000 and formulate the National Textile Policy : 2013.

The Confederation of Indian Textile Industry after collecting feedback from various Textile Mills Associations submittedits recommendations to the Expert Committee on 22nd October, 2013. The Federation of Indian Chambers of Commerce& Industry also submitted its recommendations to the Expert Committee on 1st January, 2014.

On 28th July, 2014, the Chairman, Expert Committee submitted its Draft Report “Vision, Strategy and Action Plan forIndian Textiles & Apparels” to the Textile Minister. The final National Textile Policy is yet to be announced.

SPECIAL PACKAGE FOR EMPLOYMENT GENERA TION & PROMOTION OFEXPORTS :On 22nd June, 2016, the Government has unveiled a package, which provides for generation of one crore jobs in thetextile and apparel industry over next three years. The majority of jobs are likely to go to women since the garmentindustry employs about 70% women workforce. This package will lead to a cumulative increase of US$ 30 billion inexports and investment of Rs. 74,000 crore over next three years. Salient features of the package are :-

l Government shall bear entire 12% of employers contribution to Employees Provident Fund Scheme for newemployees of the garment industry for first three years, who are earning less than Rs. 15000 p.m. The Ministryof Textiles shall provide additional 3.67% of employers’ contribution (8.33% is already provided under PradhanMantri Rojgar Protsahan Yojana) amounting to Rs.1170 crore over next three years.

l EPF shall be made optional for employees earning less than Rs.15000 p.m. leaving more money in their hands.


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l Overtime hours of workers not to exceed 8 hours per week in line with ILO norms.l Looking to seasonal nature of industry, fixed term employment shall be introduced in the garment sector. Such

workmen shall be considered at par to permanent workmen in terms of working hours, wages, allowances andother statutory dues.

l The package breaks new ground in moving from input to outcome based incentive by increasing subsidy underAmended-TUFS from 15% to 20% for garment sector. The subsidy under the scheme would be disbursed onlyafter the expected jobs are created.

l A new scheme will be introduced to refund State levies which are not refunded so far. This move is expected tocost the exchequer Rs. 5500 crore, but will greately boost competitiveness in foreign markets.

l Drawback at All Industries Rate to be given for domestic duty paid inputs even when fabric is imported underAdvance Authorisation Scheme.

l For the garment industry, the provision of 240 days under Section 80 JJA of Income Tax Act would be relaxedto 150 days looking to the seasonal nature of garment industry.

GROWTH OF TEXTILE INDUSTRY :The Technology Upgradation Fund Scheme has been the growth engine for textile industry modernization. In the EleventhFive Year Plan, India’s spindlage increased from 37 million to 52 million. In the Twelveth Plan, industry is expected tocontinue with addition of 15 million spindles. The Organised Sector is dominated by spinning units, which, in terms ofnumbers, account 80% of the units in this Sector. Out of 1982 textile units, in the organized sector 1781 are spinningmills and 201 are composite. The weaving capacity of the organized mill sector stagnated for a number of years mainlybecause of existing Textile Policy. From 1992, the weaving capacity has been decreasing substantially. However, thisreduction in the capacity is compensated by emergence of decentralized powerloom and hosiery sectors in a big way.With the thrust on weaving/technical textiles sector in the Amended Technology Upgradation Fund Scheme, weavingand technical textile sectors are expected to grow in the coming years.

The expansion of spinning sector has largely taken place in Tamil Nadu, Andhra Pradesh, Punjab, Gujarat and MadhyaPradesh. Tamil Nadu alone accounts for about 46% of total spindleage in the Country.

The comparative data of last seven years in respect of Mills and their capacity is as under :-

2010 2011 2012 2013 2014 2015 2016

Textile Mills

Spinning Mills (Non SSI) 1673 1757 1761 1771 1757 1776 1781

Spinning Mills (SSI) 1260 1333 1336 1332 1307 1325 1335

Composite Mills (Non SSI) 180 183 196 198 197 200 201

Exclusive Weaving Mills 183 174 173 173 174 174 175

Powerloom Units (Lakh Nos.) 5.05 5.18 5.20 5.28 5.30 5.43 5.54

CAPACITY

Spindles (SSI + Non SSI) (Million Nos.) 42.04 47.58 48.25 49.17 49.46 50.16 51.36

Rotors (SSI + Non SSI) (Lakh Nos.) 6.75 7.49 7.71 7.95 8.14 8.33 8.57

Looms (organized sector) (Lakh Nos.) 0.71 0.66 0.66 0.66 0.66 0.67 0.68

Power looms (Lakh Nos.) 22.46 22.92 22.98 23.47 23.67 24.75 25.23

Knitting Machines (Nos.) in Composite 1106 1398 1398 1532 1529 1529 1590

& exclusive Weaving Mills

Hand loom (Lakh Nos.) 23.77 23.77 23.77 23.77 23.77 23.77 23.77

Worsted Spindles Woollen (Lakh Nos.) 6.04 6.04 6.04 6.04 6.04 6.04 6.04

Non-Worsted Spindles Woollen (Lakh Nos.) 4.37 4.37 4.37 4.37 4.37 4.37 4.37

Woollen Power looms (Nos.) 7228 7228 7228 7228 7228 7228 7228


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India has second largest manufacturing capacity globally. Textile Industry accounts for about 24% of the World spindlecapacity and 8% of World rotor capacity. It has highest loom capacity (including handlooms) with 63% of World’smarket share.

SPUN YARN PRODUCTION :PRODUCTION :

More than 95% of the yarn is produced in the Organised Sector.

The figures of spun yarn production (Cotton, Blended and 100% Non-cotton yarn) during the last eleven years withpercentage share including production in SSI Sector are given below :-

Year Cotton Yarn Blended Yarn 100% Non-cotton Yarn Total

Mn Kgs %age share Mn Kgs %age share Mn Kgs %age share Mn Kgs

2005-06 2521 72.90 588 17.00 349 10.10 3458

2006-07 2824 74.06 635 16.65 354 9.28 3813

2007-08 2948 74.00 677 17.00 378 9.00 4003

2008-09 2898 74.08 655 16.75 361 9.17 3914

2009-10 3079 73.43 707 16.86 407 9.71 4193

2010-11 3490 74.05 797 16.91 426 9.04 4713

2011-12 3126 71.60 789 17.88 457 10.52 4372

2012-13 3583 73.60 828 17.01 457 9.39 4868

2013-14 3923 74.09 896 16.86 485 9.05 5309

2014-15 4055 73.97 920 16.68 513 9.35 5488

2015-16 4136 73.06 971 17.15 554 9.79 5661

It will be observed that production of cotton yarn has increased during the year by about 2.00% and total yarn productionby 3.15%. The lower increase in production may be because of decrease on exports to China.

STOCK OF SPUN YARN :The position of stock of spun yarn at the end of each year since 2010-11 has been as under :-


2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

Cotton Yarn 186.43 110.87 107.92 133.80 140.60 142.57

Blended Yarn 48.79 42.20 40.37 51.33 48.30 49.93

100% Non Cotton Yarn 18.00 20.44 21.38 23.40 22.48 24.08

Total 253.22 173.51 169.67 208.53 211.38 216.58

ANALYSIS OF STATEWISE PRODUCTION OF COTTON AND COTTON YARN :An analysis of statewise production of cotton and production of yarn figures show that the States, which contributedhighest in the production of cotton such as Gujarat – 29.01%, Maharashtra – 20.72%, Andhra Pradesh – 19.95% arecontributing towards cotton yarn production at 4.70%, 7.63%, and 9.92% respectively. However, Tamil Nadu whichgrows cotton – 1.55% contributed 37.96% to cotton yarn production.

The share of our State Madhya Pradesh in cotton production during 2014-15 was 4.92% only, whereas in cotton yarnproduction it was 8.14%.


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The following table gives the share of each State in cotton and yarn production in the Country during the year 2014-15:-

State Production of Cotton Production of Yarn : % ShareLakh Bales % Share Cotton Blended Non Cotton Total

Punjab 13.00 3.37 15.56 12.12 19.96 15.40

Haryana 23.00 5.99 5.27 1.50 5.11 4.28

Rajasthan 17.00 4.40 3.81 23.55 19.16 8.55

Gujarat 112.00 29.01 4.70 3.16 1.43 4.11

Maharashtra 80.00 20.72 7.63 7.22 7.60 7.56

Madhya Pradesh 19.00 4.92 8.14 8.29 5.06 7.88

Andhra Pradesh 77.00 19.95 9.92 3.64 7.82 5.03

Karnataka 34.00 8.80 0.77 0.19 0.18 0.62

Tamil Nadu 6.00 1.55 37.96 25.22 23.44 34.46

Uttar Pradesh - - 0.86 1.15 3.37 1.22

Himachal Pradesh - - 1.73 5.69 2.93 2.71

Uttaranchal - - 0.86 1.15 1.47 1.03

Dadra Nagar Haveli - - 1.38 1.40 0.01 1.26

Others 5.00 1.29 1.41 6.72 2.46 5.89

Total 386.00 100.00 100.00 100.00 100.00 100.00

The top four yarn manufacturing States during 2014-15 are Tamil Nadu, Punjab, Rajasthan and Madhya Pradesh. Duringthe year 2014-15, the share of total yarn production of our State is 7.88%.

PRODUCTION OF FILAMENT YARN :As on 31st March, 2016, the Country had capacity to produce Filament Yarn as under :-


Item Quantity

Viscose Filament Yarn 79.52

Nylon Filament Yarn 32.00

Polyester Filament Yarn 2103.23

Polypropelene Filament Yarn 17.63

Total… 2232.38

The present capacity utilization in this Sector is only around 55%.The production of Filament Yarn in the Country during the years 2009-10 to 2015-16 is given below :-


2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

Viscose Filament Yarn 42.70 40.92 42.35 42.63 43.99 43.93 45.38

Nylon Filament Yarn 30.35 33.46 27.95 22.91 24.09 32.45 37.13

Polyster Filament Yarn 1434.88 1462.27 1379.52 1288.15 1212.43 1157.41 1068.80

Polypropylene Filament Yarn 14.79 13.14 13.19 17.18 12.91 12.76 12.67

Total 1522.72 1549.79 1463.01 1370.87 1293.42 1246.55 1163.98


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PRODUCTION OF FABRICS :The weaving industry is mainly characterized by the Unorganised Sector, with powerlooms accounting for 57%, hosieryunits for 27% and handloom around 12% of total cloth production. Organised sector weaving mills account for balance4% of cloth production.

The production of fabrics increased by 584 million square metres in 2015-16. In 2015-16 the production in Mill Sectordecreased by 6.94%, whereas the Hosiery Sector production was up by 4.42%.

The figures of production of fabrics in all the four sectors for last seven years are given hereunder :-

Quantity in Million Square MetresType of Cloth 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

Mill Sector

Cotton 1465 1604 1724 1684 1622 1592 1502

Blended 482 526 521 674 818 808 734

100% Non Cotton 69 75 68 60 91 86 77

Total 2016 2205 2313 2418 2531 2486 2313

Hand loom Sector

Cotton 5857 5973 6021 6239 6315 6427 6811

Blended 137 143 121 115 145 88 109

100% Non Cotton 812 791 759 598 644 688 696

Total 6806 6907 6901 6952 7104 7203 7616

Power loom Sector

Cotton 10128 11883 12027 13956 14320 15241 15717

Blended 5487 5853 6302 6655 7117 7511 7822

100% Non Cotton 21382 20279 19116 17428 15353 14998 13807

Total 36997 38015 37445 38038 36790 37750 37346

Hosiery/Knitted Sector

Cotton 11464 12258 10798 11992 13256 13699 14429

Blended 1661 1756 1524 1838 1982 2042 2132

100% Non Cotton 577 620 624 711 961 1153 1080

Total 13702 14634 12946 14541 16199 16894 17641

Cotton 28914 31718 30570 33870 35513 36959 38459

Blended 7767 8278 8468 9282 10062 10449 10797

100% Non Cotton 22840 21765 20567 18797 17049 16924 15660

Total 59521 61761 59605 61949 62624 64332 64916

Khadi,Silk& Wool 812 798 848 843 876 944 944

Grand Total 60333 62559 60453 62792 63500 65276 65860

The following table gives the percentage share of fabric production in various sectors :-Sector Production Mn. Sq. Mtrs. Percentage share

2012-13 2013-14 2014-15 2015-16 2012-13 2013-14 2014-15 2015-16

Mills 2418 2531 2485 2313 3.85 3.99 3.81 3.51

Powerloom 38038 36790 37750 37346 60.58 57.93 57.83 56.71

Handloom 6952 7104 7203 7616 11.07 11.19 11.03 11.56

Hosiery/Knitted 14541 16199 16894 17641 23.16 25.51 25.88 26.79

Khadi/Silk/Wool 843 876 944 944 1.34 1.38 1.45 1.43

Total 62792 63500 65276 65860 100.00 100.00 100.00 100.00


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It will be observed from the above table that production percentage in Hosiery/Knitted Sector is rising continuously,whereas in other Sectors it is almost stagnant. Mill sector is concentrating mainly on spinning and production of highvalue fabrics/fabrics for exports.

STATUS OF PRODUCTION OF COTTON YARN & FABRIC IN WORLD IN 2014-15 :The status of cotton yarn and fabrics production in 2014-15 is as under :-

Item Unit India World India’s Share India’s Rank Country with Rank-I

Cotton Yarn Mn.Kgs. 4054 21000 19.30% II China - 25%

Cotton Fabric Mn.Sq.Mtrs. 36959 250000 14.80% II China - 30%

PRODUCTION OF WOOLLEN ITEMS :The production of Woollen items from 2005-06 to 2014-15 has been as under :-

Year Worsted Yarn Woollen Yarn Fabrics Shoddy Yarn

Mn. Kgs. Mn. Kgs. Mn. Mtrs. Mn. Kgs.

2005-06 53.00 34.00 75.00 32.00

2006-07 58.00 35.00 80.00 37.00

2007-08 58.00 35.00 81.00 38.00

2008-09 60.00 30.00 85.00 40.00

2009-10 61.00 30.00 87.00 42.00

2010-11 62.00 30.50 88.00 43.00

2011-12 61.00 30.00 87.00 44.00

2012-13 62.00 30.00 88.00 44.00

2013-14 63.00 32.00 90.00 44.00

2014-15 63.15 32.25 90.25 44.25

PER CAPITA AVAILABILITY OF CLOTH :The position of per capita availability of cloth since 2005-06 is as under :-

Quantity in Sq. Mtrs.Year Cotton Blended/Mixed 100% Non-cotton Total

Fabrics Fabrics

2005-06 16.37 4.32 15.41 36.10

2006-07 17.90 4.69 17.01 39.60

2007-08 19.01 4.81 18.03 41.85

2008-09 17.89 4.50 16.62 39.01

2009-10 19.70 5.29 18.13 43.12

2010-11 21.35 5.57 17.04 43.96

2011-12 19.76 5.47 15.23 40.46

2012-13 19.88 5.45 13.14 38.47

2013-14 19.80 5.61 10.75 36.16

2014-15 23.57 6.66 10.38 40.61


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GROWTH OF TEXTILE INDUSTRY IN STATE :MILLS & PERFORMANCE :All the textile mills in the State are not our Members and as such the statistics available on the website of the Office ofThe Textile Commissioner are used. According to the Office of the Textile Commissioner, the structure of the TextileIndustry in the State has been as under :-

2011-12 2012-13 2013-14 2014-15 2015-16

Textile Mills :

Spinning Units (Non-SSI) 43 44 43 43 43

Composite Mills. 14 15 16 16 16

Spinning Mills (SSI) 5 5 5 6 6

Exclusive Weaving Mills (Non-SSI) 4 4 4 4 5

100% Export Oriented Units 2 1 1 1 -

Number of Powerlooms 1,18,217 1,24,853 1,26,679 1.33,425

Number of Powerloom Units 46,187 49,087 49,968 53,043

Number of Handloom Units 3604 3604 3604 3604 3604

Man-made fibre Units 1 1 1 1 1

Man-made filament yarn Units 2 2 2 2 2

INSTALLED CAPACITY :

a) No. of Spindles (Non-SSI & SSI) 1,985 2,051 2,254 2,300 2,478

(in thousand)

b) No. of Rotors (Non-SSI & SSI) 28,128 28,416 31,272 31,488 33,888

c) No. of Looms (Composite & 3,845 3,897 4,033 4,033 4,469

Exclusive Weaving Units).

d) No. of Knitting Machines 133 133 141 141 159

Although the number of mills reported by the Textile Commissioner’s Office are 59, but many of the mills are eitherclosed or not having any activity and are being shown as live units. Thus the operational mills are around 45 only. OurState has only about 4.59% of the total spindleage in the Country.

PRODUCTION OF SPUN YARN :The figures of spun yarn production in the State since 2008-09 are as under :-

Quantity in Thousand Kgs.

Yarn 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15

Cotton Yarn 147636 181004 206866 206639 264535 299696 330074

Blended Yarn 47474 53652 62376 61291 62768 75002 76281

100% Non-Cotton Yarn 18159 25254 23466 25356 25803 26369 26000

Total spun yarn 213269 259910 292708 293286 353106 401067 432355

During 2014-15 the total spun yarn production in the State was 4,32,355 thousand Kgs., which is about 7.88% of theCountry’s production of 54,87,639 thousand Kgs.

Annexure-IV gives the figures of Spun Yarn produced by our Member- Mills during the year 2015-16.


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FABRIC PRODUCTION :The weaving segment of the mill sector in the State is increasing every year. The following table gives the position offabric production (Mill Sector) in the State since 2008-09 :-

Quantity in Thousand Sq. Mtrs.

Fabric 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15

Cotton 69355 102950 110356 108821 119231 117412 164843

Blended 9128 20668 29157 24140 32796 43909 62175

100% Non-Cotton 517 515 710 379 293 362 1513

Total 79000 124133 140223 133340 152320 161683 228531

During 2014-15, fabrics production in the State was about 9.20% of Country’s total fabrics production.

Annexure-V gives the figures of Production of Fabrics (Woven & Knitted) during the year 2015-16 while Annexure-VIcontains the figures of Production of Knitted Garments by the Member Mills.

DOMESTIC DELIVERY OF HANK YARN :Hank Yarn Obligation was introduced in 1974 at 50% of production of cotton and Viscose yarn. However, the currentNotification promulgated in 2003 under the Essential Commodities Act, prescribes that every producer of yarn, whopacks yarn for civil consumption, shall pack atleast 40% of yarn packed for civil consumption in hank form, on aquarterly basis and not less that 80% of Hank Yarn packed shall be on counts 80s and below. National HandloomCensus carried out by Office of Development Commissioner (Handlooms) and the data submitted to the Committee toReview HYO in July, 2011 shows reduction in handlooms by about 40% during 1987 to 2010, whereas cotton yarnproduction increased by about 133%. Calculations show that less than 15% HYO was sufficient in 2010. Therefore,there is a strong case for abolition of HYO.

As per decision taken in the 69th Meeting of Hank Yarn Price Monitoring Committee, all Spinning Mills are to registeronline and e-file the Hank Yarn Return (Annexure-I and II) from October-December, 2014 quarter. It is mandatory for allunits to submit the Returns from January-March, 2015.

The domestic deliveries of spun yarn in hank form has been as under :-

Year Quantity in Mn. Kgs.

2005-06 471.00

2006-07 504.00

2007-08 535.00

2008-09 520.00

2009-10 523.00

2010-11 536.00

2011-12 534.00

2012-13 542.00

2013-14 557.00

2014-15 566.00

2015-16 601.00

The Central Government should scrap the existing Hank Yarn Obligation and Handloom Reservation Act and shouldannounce a new Handloom Policy, which could showcase the Indian Handlooms as testimony of a rich cultural heritage.


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TECHNOLOGY UPGRADATION FUND SCHEME :This Scheme, which was started on 1st April, 1999, has given major thrust to the Textile Sector. On 1st November, 2007,the Ministry of Textiles announced continuation of TUFS for the entire period of 11th Five Year Plan, i.e., upto 31st March,2012 with special thrust on garmenting, technical textiles and processing segments of the industry. However, theScheme was kept in abeyance from 28th June, 2010 to 27th April, 2011 and for the period 28th April, 2011 to 31st March,2012, the Restructured Technology Upgradation Fund Scheme was introduced, which continued upto 31st March, 2013.The Scheme was again revised on 4th October, 2013 and introduced from 1st April, 2013 as Revised RestructuredTechnology Upgradation Fund Scheme (RRTUFS).

The office of Textile Commissioner appointed M/s. Wazir Advisors Pvt. Ltd., Gurgaon, on 16th April, 2015, for undertakingthe work of evaluation of Restructured Technology Upgradation Fund Scheme (RTUFS) and Revised RestructuredTechnology Upgradation Fund Scheme (RRTUFS). This Study was to cover all stakeholders like beneficiaries,implementing lending agencies, industry associations, etc. and to be completed within four months.

The Ministry of Textiles issued a Resolution dated 13th January, 2016, modifying the provisions of Revised RestructuredTechnology Upgradation Fund Scheme (RRTUFS) and introduced a new scheme “Amended Technology UpgradationFund Scheme (ATUFS)”, which will be effective from date of issue for a period of seven years upto 31st March, 2022. TheBudget provision for the Scheme is Rs. 17822 crore for next seven years. It is to attract investment of Rs. One lakhcrore and generate employment for 30 lakh persons.

The cases pending for issue of UID, since September, 2014 as per records of Office of Textile Commissioner shall becovered under RRTUFS. Under the new scheme, individual entity will be eligible for one time capital subsidy only on theeligible investment, as per the rates and overall subsidy cap indicated below:

l Garmenting, Technical Textiles – Capital subsidy of 15% on eligible machines; CIS per individual entity Rs. 30crore. As per Resolution dated 25th July 2016, additional incentive of 10% will be provided to garmenting unitsand the CIS would stand enhanced from Rs. 30 crore to Rs. 50 crore.

l Weaving for brand new Shuttlelless Looms (including weaving preparatory and knitting), processing, jute, silkand handlooms – Capital subsidy of 10% on eligible machines; CIS per individual entity Rs. 20 crore.

l Composite units/Multiple Segments – If eligible capital investment in respect of Garmenting and TechnicalTextiles is more than 50% of eligible project cost – Capital subsidy of 15% on eligible machines; CIS perindividual entity Rs. 30 crore.

l Composite units/Multiple Segments – If eligible capital investment in respect of Garmenting and TechnicalTextiles is less than 50% of eligible project cost – Capital subsidy of 10% on eligible machines; CIS perindividual entity Rs. 20 crore.

In cases, where the applicant had availed subsidy under RRTUFS, he will be eligible for only the balance amount withinthe overall ceiling fixed for individual entity. The maximum subsidy for overall investment by individual entity underATUFS will be restricted as indicated above.

The benefits under the Scheme shall be available only if the eligible benchmark machinery is purchased by availing termloan from a notified agency. Term loan should not be for less than three years including moratorium (for SSI – five years).Term loan component of machinery should be kept at a minimum of 50% of total cost of project. The Unit should workfor atleast for the minimum period of term loan. Capital Investment Subsidy will be released in full in one go aftersatisfactory commissioning/installation and commencement of production.

SPECIAL TEXTILE PACKAGE OF FISCAL ASSISTANCE IN STATEINDUSTRIAL PROMOTION POLICY – 2014 :The State Government notified Industrial Promotion Policy - 2014 on 1st October, 2014, which includes the followingSpecial Package for Textile Industry :-

1. INVESTMENT SUBSIDY :Micro, small and medium textile units shall be given an investment subsidy of 10% of eligible investment made

in TUFS approved plant & machinery subject to a maximum limit of Rs. One crore.


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2. INTEREST SUBSIDY :l For New Units with an investment of upto Rs. 25 crore in Fixed Assets : 2% for 5 years from the date

of commercial production on term loan taken for TUFS approved plant & machinery subject to a ceilingof Rs. 5 crore.

l New standalone units with an investment of more than Rs. 25 crore in fixed Assets OR Expansion/Diversification of Existing Standalone unit with fresh investment in TUFS approved plant & machinery ofat least 30% of existing investment in Fixed Capital Assets (Not less than Rs. 25 crore) or Rs. 50crore, whichever is less : 5% for 5 years from the date of commercial production on term loan taken forTUFS approved plant & machinery.

l New composite unit* with an investment of more than Rs. 25 crore in fixed Assets OR Diversification ofExisting Standalone unit into a composite unit : 7% for 5 years from the date of commercial production onterm loan taken for TUFS approved plant & machinery.

*For an unit to be classified as Composite Unit, it should be doing either of the following manufacturing activitiesirrespective of its locations (location may be same or at different places within the State of Madhya Pradesh) andutilizing at least 75% of primary produce (such as yarn) as an input to the downstream activities :

l Cloth manufacturing using thread and processing activities (weaving/knitting and processing activities).l Cloth processing and manufacturing (processing and garmenting).l Thread manufacturing – Apparel manufacturing using thread, processing and apparel manufacturing using

cloths (spinning, weaving/knitting – processing & garmenting).l Made-up articles.

3. ENTRY TAX EXEMPTION :l For Units with an investment of upto Rs. 100 crore in plant & machinery including buildings & sheds, but shall

not include land & dwelling units : For five years.l For Units with an investment of more than Rs. 100 crore in plant & machinery including buildings & sheds, but

shall not include land & dwelling units : For seven years.

4. VAT & CST Assist ance :Industrial investment promotion assistance will be given for 8 years from the date of commercial production,within an overall ceiling of investment in TUFS approved plant & machinery, to Units with investment of Rs. 1crore or more in fixed capital, as described below:

l Cotton ginning – equivalent to the CST paid on interstate sale of ginned cotton.l Spinning mill – equivalent to the computed gross CST on interstate sale of cotton yarn.l Cloth manufacturing unit (Cloth is a tax free product) – equivalent to VAT paid on purchase of cotton yarn by

the manufacturing unit; andl Readymade garment/App arel unit – equivalent to VAT & CST paid on sales of readymade garment/apparel.

However, the assistance shall not be more than net tax deposited with Government of Madhya Pradesh.

5. 25% subsidy shall be given for est ablishment of Apparel Training Institute toa maximum limit of Rs. 25 lakh.

6. Expansion/Diversification/T echnical Up-gradation :l Large and medium industrial units, which invest 30% of existing investment in plant & machinery or Rs. 50

crore (whichever is less) on expansion/diversification/technical up-gradation, will be eligible for assistance /facilities at par with new industrial units.

l Small scale industrial units, which invest minimum 50% of its existing investment in plant & machinery (notbeing less than Rs. 25 lakh), shall be eligible for assistance/facilities at par with new industrial units.


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FOREIGN DIRECT INVESTMENT :The position of total financial year-wise FDI Equity inflows in the Country and in the Textile Sector is given in thefollowing table :-

(Amount in Billlion)Financial Year Inflow of FDI in India % of FDI in

Total (all sectors) Textiles (Including TextilesDyed, Printed) in terms of Rs.

Rs. US$ Rs. US$

2000-01 103.68 2.38 0.09 0.002 0.09

2001-02 184.86 4.03 0.24 0.01 0.13

2002-03 128.71 2.70 2.58 0.05 2.00

2003-04 100.64 2.19 0.43 0.01 0.43

2004-05 146.53 3.22 1.97 0.04 1.34

2005-06 245.84 5.54 4.15 0.09 1.69

2006-07 563.90 12.49 5.68 0.13 1.01

2007-08 986.42 24.58 7.45 0.19 0.76

2008-09 1428.29 31.40 7.57 0.16 0.53

2009-10 1231.20 25.83 7.15 0.15 0.58

2010-11 973.20 21.38 5.89 0.13 0.61

2011-12 1651.46 35.12 8.04 0.16 0.49

2012-13 1219.07 22.42 5.66 0.10 0.46

2013-14 1475.18 24.30 12.19 0.20 0.83

2014-15 1891.07 30.93 12.17 0.20 0.64

2015-16 2628.54 40.12 14.85 0.23 0.56

Grand Total 14958.39 288.63 96.10 1.85 0.64

Data Source: DIPP

SCHEME OF INTEGRATED TEXTILE PARKS :Ministry of Textiles approved 57 textile parks under the Scheme, which include only one such park in our State.

The only Textile Park in Madhya Pradesh (CLC Textile Park) at Pandhurna in Chindwara District has been set up. ThePark is spread over 20 acres of land, and comprises of ginning and pressing units, spinning, weaving, home textiles andreadymade garment units. The infrastructure cost of the Park is Rs.95.65 Crore, the assistance admissible under theScheme is Rs.38.26 Crore. Investment of Rs. 594.46 Crore is likely to be made in this Park, which would provide directemployment to 14000 persons and indirect employment to 33000 persons. When fully operational, annual productionfrom this Park will be of Rs. 1250 Crore.

TECHNICAL TEXTILES :The technical textiles sector in the Country is expected to clock a 20% year-on-year growth during 12th Five Year Planperiod. With a market size of Rs. 70311 Crore the sector has recorded 11% to 12% growth in last five years, it shouldtouch 18% to 20% in 12th Plan period. Presently around 30% of India’s requirement of technical textiles is met throughimports. The Minister of State for Textiles informed Rajya Sabha on 5th February, 2014 that technical textiles account foraround 18% of overall textile industry in the World, it is just 11.43% in India. 929 Units have been registered by TextileCommissioner as Technical Textile Manufacturing Units with a total investment in proposed machineries of Rs. 4921crore.


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The segmentwise market size and domestic consumption of technical textiles in 2012-13 was estimated by the Ministryas under :-

Value : Rupees in Crore.

Sector Market Size Domestic Consumption

Agrotech 811 709

Meditech 2489 2263

Mobitech 5166 5137

Packtech 26753 25913

Sportech 4761 4358

Buildtech 3232 2655

Clothtech 10225 9665

Hometech 8748 8420

Protech 2075 2021

Geotech 454 326

Oektech 160 160

Indutech 5437 4255

Total 70311 65882

Technical Textilesmarket is expectedto reach Rs.1,58,540 crore by 2016-17. Our Member Mills – SRF Limited andMohini Fibres Pvt. Ltd. are working in this segment.

TEXTILES (DEVELOPMENT & REGULA TION) ORDER, 2001 :During the year under report, there was no change in the contents of the Regulations. However, Notification dated 16th

May, 2002 of the Textile Commissioner authorizing its officers to discharge the functions and powers of the TextileCommissioner in respect of matters specified in that Notification continued.

TEXTILES (CONSUMER PROTECTION) REGULATIONS, 1988 :With the removal of various textile items from the purview of Essential Commodities Act, 1955, vide order dated 15th

February 2002, the provisions of Textiles (Consumer Protection) Regulation, 1988 are now applicable only to topscontaining wool, yarn made wholly from cotton and cloth containing cotton or wool, irrespective of whether they areindigenously manufactured or imported.

TEXTILE COMMITTEE :In exercise of the powers conferred by Section 5E of the Textile Committee Act, 1963 the Central Government exemptedreadymade garments from levy of whole of Textile Committee Cess w.e.f. 18th January, 2007. It was also withdrawn fromall Textile Items & Textile Machinery Industry w.e.f. 1st June, 2007. Shri Yash Birla was appointed as Chairman of TextileCommittee w.e.f. 10th October, 2014 for a period of two years.

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EXPORTS & IMPORTS

As per Vision, Strategy and Action Plan submitted by the Expert Committee to Ministry of Textiles over the last 10years India’s Textile and Apparel exports have grown at a rate of 11%. There is no reason why India, provided it takesnecessary steps, cannot achieve 20% growth in export over the next decade. With a 20% CAGR in exports India wouldbe exporting about US$ 300 billion of textile and apparel by 2024-25. By then India should have 15% to 20% of globaltextile and apparel market against present level of 5%.

FOREIGN TRADE POLICY 2015-20 :The Foreign Trade Policy 2015-20 was unveiled by the Minister of Commerce & Industry, Mrs. Nirmala Sitharaman, on1st April, 2015. The Highlights of the new Foreign Trade Policy 2015-20 are produced below for ready reference of themember-exporters :-

MERCHANDISE EXPORTS FROM INDIA SCHEME (MEIS) :Schemes such as Focus Product Scheme, Market Linked Focus Product Scheme, Focus Market Scheme, AgriculturalInfrastructure Incentive Scrip, Vishesh Krishi and Gram Udyog Yojna (VKGUY) have been merged into a single scheme,namely Merchandise Export from India Scheme (MEIS) with no conditions. Scheme provides for reward to eligibletextile and apparel categories to the extent of 2% to 5% of FOB Value in the Countries categorized as per criteriaprescribed under the scheme. The Country Group lists were amended on 14th July, 2015 and 28th December, 2015 andsome more Countries included.

Country Groups (As on 1st April, 2016):Category A : Traditional Markets (34) – European Union (28), USA, Canada, Norway, Switzerland, Iceland & Liechtenstein.Category B : Emerging & Focus Markets (141) - Africa (55), Latin America and Mexico (45), CIS countries (12), Turkey and West Asian countries (13), ASEAN countries (10), Japan, South Korea, China, Taiwan, Hongkong, Panama Republic.Category C : Other Markets (64).

Rewards for export of notified goods to notified markets under Merchandise Exports from India Scheme (MEIS) shall bepayable as percentage of realized Free on Board (FOB) value (in free foreign exchange). The debits towards basiccustoms duty in the transferable reward duty credit scrips would also be allowed adjustment as duty drawback. Atpresent, only the additional duty of customs / excise duty / service tax is allowed adjustment as CENVAT credit ordrawback, as per Department of Revenue Rules.

SERVICE EXPORTS FROM INDIA SCHEME (SEIS) :Served from India Scheme (SFIS) has been replaced with Service Exports from India Scheme (SEIS), It shall apply to“Service Providers” located in India instead of Indian Service Providers of notified Services. The rate of reward will bebased on nett foreign exchange earned. It is now proposed to extend Chapter – 3 Incentives (MEIS & SEIS) to unitslocated in SEZs also.

Duty credit scrips to be freely transferable and usable for payment of custom duty, excise duty and service tax :

(a) All scrips issued under MEIS and SEIS and the goods imported against these scrips would be fully transferable.

(b) Scrips issued under Exports from India Schemes can be used for the following :(i) Payment of customs duty for import of inputs/goods including capital goods, except items listed in Appendix-

3A.(ii) Payment of excise duty on domestic procurement of inputs or goods, including capital goods as per

Department of Revenue (DoR) Notification.(iii) Payment of service tax on procurement of services as per DoR Notification.

(c) Basic Customs Duty paid in cash or through debit under Duty Credit Scrip can be taken back as Duty Drawbackas per DoR Rules, if inputs so imported are used for exports.


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IMPORTER-EXPORTER CODE (IEC) :l The facility for E-IEC has been operationalised.l Profile to be updated upon change immediately else atleast once in a year.

STATUS HOLDERS :Change in criteria for export performance for recognition of status holder from Rupees to US Dollar earnings as under :-

Status Category Export Performance FOB / FOR (as converted) V alue

(in US $ million) during current and previous two years

One Star Export House 3

Two Star Export House 25

Three Star Export House 100

Four Star Export House 500

Five Star Export House 2000

l Threshold to be achieved as Aggregate exports in current + previous two financial years.l For granting status, export performance is necessary in atleast two out of three years.l For deemed exports, FOB value of exports in Indian Rupees shall be converted into US$ at the exchange rate

notified by the CBEC, as applicable on 1st April of each financial year.

APPROVED EXPORTER SCHEME – SELF CERTIFICATION BY STATUS HOLDERS :Manufacturers, who are also Status Holders will be enableld to self-certify their manufactured goods as originating fromIndia with a view to qualify for preferential treatment under different Preferential Trading Agreements (PTAs), Free TradeAgreements (FTAs), Comprehensive Economic Cooperation Agreements (CECAs) and Comprehensive EconomicPartnerships Agreements (CEPAs), which are in operation. They shall be permitted to self-certify the goods asmanufactured as per their Industrial Enterpreneur Memorandum (IEM) / Industrial Licence (IL) / Letter of Intent (LOI).

TRADE FACILITATION & EASE OF DOING BUSINESS :l 24 x 7 Online filing of documents / applications and paperless trade.l Online inter-ministerial consultations.l Simplification of procedures/processes, digitization and e-governance.

NEW INITIATIVES FOR EOUS, EHTPS AND STPS :(a) EOUs, EHTPs, STPs allowed to share infrastructural facilities among themselves, which will enable units to

utilize their infrastructural facilities in an optimum way and avoid duplication of efforts and cost to createseparate infrastructural facilities in different units.

(b) Inter unit transfer of goods and services have been allowed among EOUs, EHTPs, STPs, and BTPs to facilitategroup of those units, which source inputs centrally in order to obtain bulk discount. This will reduce cost oftransportation, other logistic costs and result in maintaining effective supply chain.

(c) EOUs have been allowed facility to set up Warehouses near the port of export to help in reducing lead time fordelivery of goods and will also address the issue of unpredictability of supply orders.

(d) STP units, EHTP units, software EOUs have been allowed the facility to use all duty free equipment/goods fortraining purposes. This will help these units in developing skills of their employees.

(e) 100% EOU units have been allowed facility of supply of spares/components upto 2% of the value of themanufactured articles to a buyer in domestic market for the purpose of after sale services.

(f) In a period of five years EOU units have to achieve Positive Net Foreign Exchange Earning (NFE) cumulatively.Because of adverse market conditions or any ground of genuine hardship, such period of five years for NFEcompletion can be extended by one year.


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(g) Time period for validity of Letter of Permission (LOP) for EOUs/EHTP/STPI/BTP Units has been revised forfaster implementation and monitoring of projects. Now, LOP will have an initial validity of two years to enable theunit to construct the plant and install the machinery. Further extension can be granted by the DevelopmentCommissioner upto one year. Extenstion beyond three years of the validity of LOP, can be granted, incase unithas completed 2/3rd of activities, including the construction activities.

(h) At present, EOUs/EHTP/STPI units are permitted to transfer capital goods to other EOUs, EHTPs, STPs, SEZunits. Now a facility has been provided that if such transferred capital goods are rejected by the recipient, thenthe same can be returned to the supplying unit, without payment of duty.

(i) EOUs having physical export turnover of Rs. 10 crore and above have been allowed the facility of fast trackclearance of import and domestic procurement.

DOUBLE WEIGHTAGE :l Double weightage for MSME, manufacturing units having ISO/BIS, units located in North Eastern States including

Sikkim and Jammu & Kashmir, units located in Agri Export Zone (AEZs). A shipment can get double weightageonly once in any one of the above category.

l Double weightage shall be available for grant of One Star House Status category only.l Double weightage withdrawn for Focus Areas, units having WHO-GMP, HACCP, SEICMM Level II above, Services

Exports.

RULES OF ORIGIN :l Manufacturer Status holders eligible for Self Certification for Non-Preferential treatment.l Approved Exporter Scheme for Self Certification for Preferential treatment.l Approved Exporter Scheme to be effective when incorporated into specific agreement with partner country(ies).

DUTY EXEMPTION :(a) Imports against Advance Authorisation shall also be eligible for exemption from Transitional Product Specific

Safeguard Duty.(b) In order to encourage manufacturing of capital goods in India, import under EPCG Authorisation Scheme shall

not be eligible for exemption from payment of anti-dumping duty, safeguard duty and transitional product specificsafeguard duty.

(c) Supplies against Para 7.02 (c)(d) and (g) not exempted from Anti-dumping duty andSafeguard Duty and Transition Product Specific Safeguard Duty.

(d) Advance Authorisation for annual requirement only for notified in SION.(e) No advance Authorisation for annual requirement if any inputs fall in Appendix-4J.(f) Eligibility for Authorisation on self declared norms reduced from 500% to 300% for Status Holders.(g) Non Status Holder to be eligible for 300% or Rs. 10 crore, whichever is more.(h) A detailed list of items (including vegetables/edible oils, cereals, spices, etc.) issued, which are ineligible for

importation on self declaration basis.(i) Representation against the decision of norms Committee to be made within 90 days of hosting. Composition

fee of Rs. 5000 for delayed representation.(j) Export Obligation (EO) extension request with a self declaration that unutilized inputs are available.

DUTY FREE IMPORT AUTHORISATION SCHEME (DFIA) :l Separate DFIA for each SION and each port.l DFIA imports only exempted from BCD. ACD for non-excisable goods.l Online application to Regional Authority before starting export under DFIA.l Exports to be completed within 12 months from the date of online filing.’l Applicant to indicate file number on the export documents, viz., Shipping Bill / Airway Bill / Bill of Export / ARE-

1 / ARE-3, Central Excise certified invoice.l Request for issuance of transferable Duty Free Import Authorisation within a period of twelve months from the

date of export or six months (or additional time allowed by RBI for realization) from the date of realizationwhichever later.

l No transitional arrangement for DFIA.


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EXPORT PROMOTION CAPITAL GOODS SCHEME (EPCG) :l For indigenous sourcing of Capital Goods, the specific Export Obligation reduced by 25% of the Export Obligation

stipulated.l Provision related to EPCG Authorisation on Annual Requirement and Technological Upgradation of existing

EPCG Machinery has been omitted.l The limit on value of spares imported has now been relaxed. Export Obligation to be fulfilled through goods

manufactured from EPCG machine.l Conservation from Export Oriented Unit to Export Promotion Capital Goods.l In case where standalone EOU/SEZ unit converts : Maintenance of average EO not required. EO would be six

times of the proportionate duty saved amount of the depreciated value of Capital Goods.l In case one unit of the firm/company opts to de-bond from EOU to EPCG Scheme, while other units are DTA

units : Average Export Obligation would be fixed by excluding the exports made by the de-bonding unit from thetotal exports of the firm/company.

l Export Obligation would be six times of the proportionate duty saved amount of the depreciated value of CapitalGoods of the de-bonding unit.

l Central Excise (CE) certificate also accepted for installation certificate for excisable unit also.l Clubbing of authorization restricted only in cases where endorsed products on the authorization are same/

similar.l Authorisation holder given option of suo moto payment of duty and interest.l Period for maintenance of records after redemption of authorizations has been reduced for two days.

DUTY FREE TARIFF PREFERENCE (DFTP) SCHEME :India has already extended duty free tariff preference to 33 Least Developed Countries (LDCs) across the globe. This isbeing notified under FTP.

QUALITY COMPLAINTS AND TRADE DISPUTES :(a) In an endeavour to resolve quality complaints and trade disputes, between exporters and importers, a new

chapter, namely, Chapter on Quality Complaints and Trade Disputes has been incorporated in the ForeignTrade Policy.

(b) For resolving such disputes at a faster pace, a Committee on Quality Complaints and Trade Disputes (CQCTD)is being constituted in 22 offices and would have members from EPCs/FIEOs/APEDA/EICs.

NEW FACILITIES :l Two star and above Export Houses shall be permitted to establish Export Warehouses.l Three star and above Export House shall be entitled to get benefit of Accredited Clients Programme (ACP) as

per the guidelines of CBEC (weibsite:http://cbec.gov.in). ACP covers all Status Holders.l Manufacturers Status Holders (Three Star/Four Star/Five Star) to self-certify their manufactured goods as

originating from India for preferential treatment under various trading agreements (PTA). Gradually to be extendedto all Status Holders.

l Manufacturers Status Holders to be eligible to self-certify their goods as originating from India as per Para 2.108(d) of Hand Book of Procedures.

l Status Holders to be entitled to export freely exportable items on free of cost basis for export promotion subjectto an annual limit of Rs. 10 lakh or 2% of average annual export realization during preceeding three licencingyears, whichever is higher.

IMPORTANT NOTIFICATIONS :1. The DGFT vide its Public Notice dated 13th February, 2015 fixed application fee for online IEC to be Rs. 250. By

another Public Notice dated 17th February, 2015, DGFT stated that multiple IECs against a single PAN, if notsurrendered before 31st March, 2015 will be de-activated.

2. The DGFT vide its Notification dated 12th March, 2015 specified three mandatory documents required for exportof goods from India/import of goods into India, which include:* Bill of Lading/Airway Bill.* Commercial Invoice cum Packing List.* Shipping Bill/Bill of Export/Bill of Entry.Separate commercial invoice and packing list would also be accepted. This was again reiterated on 21st January,2016.


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3. The DGFT vide Public Notice dated 29th October, 2015, made additions/amendments in Table 2 containingITC(HS) Codewise list and Description of Goods with reward rates under MEIS of Appendix 3B.

4. As a part of Ease of Doing Business and Reduction in Transaction Costs, Ministry decided to do away withLanding Certificate required under MEIS vide Public Notice No.6/2015-20 dated 4th May, 2016. The Ministry videanother Notification dated 27th May, 2016 done away with separate applications required for shipments fromvarious ports.

DUTY DRAWBACK RA TES :The Central Government notified revised All Industry Rates of Duty Drawback on 16th November, 2015, which are effectivefrom 23rd November, 2015.

Chairman, TEXPROCIL, said “The Drawback rates announced by the Government for cotton yarn and fabric, by andlarge, are satisfactory exceptfor some inexplicable reasons the rates for dyed fabrics have been reduced even thoughthese are value added products. Further the drawback caps have also been slashed for fabric, which need to bereviewed in order to ensure full refund of duties on inputs and also to encourage exports”, A separate entry for cottonyarn of 100 counts or more has been incorporated, which is a welcome move.

The rates for some items made from man-made fibre have not been increased. One of the most commonly exportedfabric made of P/V falling under Chapter Heading 5515 has got a setback as drawback rates of these item has beenreduced. SRTEPC has requested the Drawback Directorate to look into the anomaly in MMF products.

Indian Taxpreneurs Federation has appealed to the Commerce Minister to give top priority to the textile sector in theongoing Study for Pre-trade Agreements with Eurasian Economic Union (EAEU).

The rates of Duty Drawback of some of the important items effective from 23rd November, 2015 are as under :-

DBK When Cenvat When Cenvat

Tariff No. Description of the Product facility not availed facility availed

% Value Cap % Value Cap

Rs. per kg. Rs. per kg.

(1) (2) (3) (4) (5) (6)

5106 Yarn of Carded W ool not put up for ret ail sales

510601 Containing 85% or more by weight of wool, grey, 5.0% 75.00 4.1% 61.50

weaving quality

510602 Containing 85% or more by weight of wool, dyed 5.5% 86.00 4.1% 64.10

weaving quality

510605 Woollen – MMF blended yarn grey (MMFcontent less 5.0% 57.00 4.1% 41.00

than 50% by weight)

510606 Woollen – MMF blended yarn dyed (MMFcontent less 5.5% 65.00 4.1% 44.00

than 50% by weight)

5111 Woven fabric of Carded wool or of carded fine

animal hair

511101 Containing 85% or more by weight of wool or fine animal 5.0% 86.00 3.5% 60.20

hair grey

511102 Containing 85% or more by weight of wool or fine animal 5.5% 127.00 3.5% 80.80

hair dyed


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(1) (2) (3) (4) (5) (6)

5112 Woven fabric of combed wool or of combed fine

animal hair

511201 Containing 85% or more by weight of wool or fine 5.0% 86.00 3.5% 60.20

animal hair grey

511202 Containing 85% or more by weight of wool or fine 5.5% 127.00 3.5% 80.80

animal hair dyed

5205 Cotton Yarn (other than sewing thread) cont aining

85% or more by weight of cotton, not put up for

retail sale

520501 Grey 3.0% 11.50 1.2% 4.60

520502 Dyed 2.7% 17.60 1.2% 7.80

5206 Cotton Yarn (other than sewing thread) cont aining

less than 85% by weight of cotton, not put up for

retail sale

520601 Grey* 3.0% 11.50 1.2% 4.60

520602 Dyed* 2.7% 17.60 1.2% 7.80

*Revised as under from 11th February, 2016 :

520601 Grey 3.7% 15.00 1.2% 4.90

520602 Dyed 4.4% 20.00 1.2% 5.40

5209 Woven Fabric of cotton, containing 85% or more by

weight of cotton, weighing more than 200 g/m 2

520901 Grey 4.3% 19.00 1.4% 6.20

520902 Dyed 5.0% 34.00 1.6% 10.90

520905 Denim fabric 5.5% 24.00 1.6% 9.50

520906 Denim fabric containing 1% or more by weight of 6.0% 34.00 9.9% 10.80

spandex / lycra / elastane

5211 Woven fabric of cotton, containing less than 85% by

weight of cotton, mixed mainly or solely with

man-made fibres, weighing more than 200 g/m 2

521101 Grey 5.0% 28.00 1.6% 9.00

521102 Dyed 5.5% 31.00 1.6% 9.00

521103 Denim fabrics blended with MMF 6.0% 34.00 1.9% 10.80

5212 Other Woven Fabrics of Cotton

521201 Grey 4.3% 19.00 1.4% 6.20

521202 Dyed 5.0% 34.00 1.6% 10.90

540204 Polyester Texturised / POYDyed / Undyed Filament Yarn 1.9% - 1.9% -

5407 Woven Fabric of Synthetic Filament Yarn

540701 Woven fabric containing 85% or more by weight of 7.2% 36.00 1.9% 9.50

Synthetic Filament Yarn (Grey)


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(1) (2) (3) (4) (5) (6)

540702 Woven fabric containing 85% or more by weight of 7.9% 45.00 1.9% 10.80

Synthetic Filament Yarn (Dyed)

5503 Synthetic staple fibres, not carded, combed or 1.9% - 1.9% -

otherwise processed for spinning

5504 Artificial staple fibres,not carded combed or 1.9% - 1.9% -

otherwise processed for spinning

5509 Yarn (other than sewing thread) of synthetic st aple

fibre not putup for sale

550901 Yarn containing 85% or more by weight of MMF (Grey) 10.0% 26.00 1.9% 4.90

550902 Yarn containing 85% or more by weight of MMF (Dyed) 10.9% 30.00 1.9% 5.20

550903 Other yarn mixed mainly or solely with cotton (Grey) 7.6% 19.00 1.9% 4.80

550904 Other yarn mixed mainly or solely with cotton (Dyed) 8.5% 23.00 1.9% 5.10

550905 Other yarn mixed mainly or solely with wool or fine 8.1% 32.00 1.9% 7.50

animal hair (Grey)

5512 Woven fabric of synthetic staple fibres, containing

85% or more by weight of synthetic stample fibre

551201 Grey 7.9% 47.00 1.9% 11.30

551202 Dyed 8.4% 56.00 1.9% 12.70

5515 Other woven fabric of synthetic staple fibres

551501 Containing 85% or more by weight of Man-made Staple 7.9% 47.00 1.9% 11.30

Fibre and/or Man-made Filament Yarn (Grey)

551502 Containing 85% or more by weight of Man-made Staple 8.4% 56.00 1.9% 12.70

Fibre and/or Man-made Filament Yarn (Dyed)

6002 Knitted or crocheted fabric of a width not

exceeding 30 cm, containing by weight 5% or more

of elastomeric yarn or rubber thread,other than

those of heading 6001

600201 Of Wool 5.0% 86.00 3.5% 60.20

600202 Of Man-made fibre (Grey) 7.2% 36.00 1.9% 9.50

600203 Of Man-made fibre (Dyed) 7.9% 48.00 1.9% 10.80

600204 Of Cotton (Grey) 5.0% 28.00 1.6% 9.00

600205 Of Cotton (Dyed) 5.5% 31.00 1.6% 9.00

6003 Knitted or crocheted fabric of a width not

exceeding 30 cm, other than those of heading

6001 or 6002

600304 Of cotton (Grey) 4.3% 19.00 1.4% 6.20

600305 Of cotton (Dyed) 5.0% 28.00 1.6% 9.00

6005 Warp knit fabrics (including those made on gallon

knitting machines), other than those of heading

6001 to 6004

600504 Of cotton (Grey) 4.3% 19.00 1.4% 6.20


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INTEREST EQUALISATION (1st April, 2015 to 31 st March, 2020) SCHEME :Reserve Bank of India has notified on 4th December, 2015, Interest Equalisation Scheme on Pre and Post Shipment

Rupee Export Credit effective from 1st April, 2015 for five years. The rate of interest equalization @ 3% per annum will be

available on exports under 416 Tariff Lines, which include readymade garments and made-ups, fabrics of all types, etc.

This Scheme has excluded cotton yarn and is also not available to the merchant exporters. Shri R. K. Dalmiya, Chairman,

Texprocil, has pointed out that cotton yarn exports are currently passing through difficult market conditions, especially in

China and this product should be covered under the Scheme to enable yarn exporters to reduce costs and remain

competitive in export market.

FOREIGN EXCHANGE MANAGEMENT (EXPORT OF GOODS & SERVICES)REGULATIONS:New regulations for export of Goods & Services were notified by Reserve Bank of India on 12th January, 2016. Master

Directions were issued on 12th May, 2016.

SERVICE TAX REFUNDS :Refunds in respect of various services including the Central Government services provided by Clearing and Forwarding

Agents to exporters is allowed. The threshold limit of refund of Service Tax paid by exporters on foreign commission

agent’s services was enhanced from 2% of FOB Value to 10% of FOB Value of export goods. The Drawback Benefit is

allowed simultaneously with refund of Service Tax in respect of exports since 7th December, 2008.

VALUE OF RUPEE :During the year, there were ups and downs in the value of Rupee against US Dollar. In the beginning of year, it was ruling

at 62.80, whereas at the close of the year it was around 66.90.

Month Apl ‘15 May Jun Jly Aug Sep Oct Nov Dec Jan ‘16 Feb Mar

Re/Dollar 62.80 63.80 63.90 63.60 65.10 66.20 65.10 66.10 66.60 67.31 68.20 66.90

REFUND OF STATE LEVEL DUTIES :The Industry has been pursuing with the Central Government the matter regarding refund State level taxes to emporters,

which include CST, Electricity Duty, Mandi Tax, Entry Tax, Other Local Taxes, etc., amounting to around 6% of FOB

value of exports in various States and reduce the amount from the allocation to State Governments from the Central Pool.

REGISTRATION OF COTTON YARN EXPORT CONTRACTS :Vide Notification dated 8th December, 2014, the registration requirement of cotton yarn (Tariff Code 5205, 5206 and 5207)

was dispensed with.

EXPORT OF TEXTILES :Export of textile products, including garments, has the largest share in the exports from the Country. The details of

exports of textiles and clothing (including silk, jute and handicrafts) and their percentage shares in the total export of all

commodities since 2005-06 are given below :-


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Export of T extiles % Shares of

Year Export of all Commodities & Clothing (includes jute, textiles / clothing

coir and handicrafts) in total export

Rs. Crore US$ Million Rs. Crore US$ Million

2005-06 456417.86 103285.33 77567.47 17533.17 17.00

2006-07 571779.28 126248.46 86702.65 19143.88 15.20

2007-08 655863.52 162987.95 89120.85 22147.33 13.59

2008-09 840755.06 182812.58 96311.93 20941.93 11.47

2009-10 845533.64 178307.39 104792.98 22098.90 12.40

2010-11 1142921.92 250750.75 124706.23 27359.87 10.91

2011-12 1465959.39 305726.67 157237.46 32791.76 10.70

2012-13 1634318.84 300150.38 170268.80 31270.67 10.40

2013-14 1905011.09 314877.87 233411.09 38580.35 12.30

2014-15 1896348.42 310114.21 235586.85 38526.06 12.40

2015-16 1714617.70 262031.23 248126.00 36748.38 14.00

PRODUCTWISE EXPORTS :

The details of exports of all textile items (Chapter Headings 50 to 63) during last four years are given below :-

Value Rs. in Crore/US$ in MillionItem 2012-13 2013-14 2014-15 2015-16

Qty. Value Qty. Value Qty. Value Qty. Value

Fibre Rs. 2794.58 23047.17 2852.24 26478.63 2072.27 16048.92 2430.97

$ 4231.94 4376.63 2624.52 2693.39

Fibre Waste Rs. 93.80 673.61 102.63 876.10 61.96 534.01 59.24

$ 123.69 144.81 87.33 72.92

Yarn Rs. 1983.67 30156.20 2248.34 40690.67 2200.42 36594.03 2246.71

$ 5537.31 6725.73 5984.31 5403.98

Fabric Rs. 7262.76 23114.09 8130.02 28292.15 4189.39 30267.08 3989.43

$ 4244.23 4676.39 4949.65 4572.89

RMG Rs. 3.33 70522.00 4.50 90773.39 4.02 103020.61 4.03

$ 12949.32 15003.87 16847.20 16984.09

Made-ups Rs. 796.89 21979.94 864.23 27039.83 843.54 28405.77 874.06

$ 4035.98 4469.39 4645.26 4584.91

Others Rs. 10493.70 13153.97 15417.57

$ 1928.87 2174.21 2521.27 2434.20

Total Rs. 179986.71 227304.74 230287.99 240554.88

$ 33049.34 37571.03 37659.52 36748.38

Growth % Rs. 8.74 26.29 1.13 4.46

$ (-)4.25 13.68 0.24 (-)2.19

Quantity of Fibre, Fibre Waste, Yarn, Made-ups are in Million Kgs., whereas Fabric is in Million Sq.mtrs. and RMG inMillion Nos., Others have within sub-group different units.


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The export of yarn, fabrics and made-ups were down in 2015-16 as compared to 2014-15. The total textile and clothing

exports could not achieve the official target of US$ 45 million.

COUNTRYWISE EXPORT OF ALL TEXTILE ITEMS :The details of major Country-wise export of all textile items (Chapter Headings 50 to 63) during last five years are as

under :-

Figures in Million.

Sr. COUNTRY 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016

No. Rs. US$ Rs. US$ Rs. US$ Rs. US$ Rs. US$

1 U S A 285852 5961 333464 6123 406136 6713 437686 7158 7524

2 U Arab Emts 105546 2201 119105 2187 161746 2673 230699 3773 4467

3 China P Rp 213066 4444 195750 3594 249321 4121 158855 2598 1971

4 U K 100332 2092 114342 2100 137459 2272 151776 2482 2399

5 Bangladesh 61286 1278 96258 1768 116918 1933 120832 1976 2088

6 Germany 89482 1866 86603 1590 110221 1822 111680 1826 1683

7 France 48017 1001 45977 844 58834 972 67365 1102 1028

8 Spain 37884 790 40982 753 50050 827 55501 908 963

9 Italy 47823 997 41673 765 52880 874 52698 862 777

10 Turkey 33984 709 36381 668 52532 868 45062 737 619

11 Netherland 35059 731 32222 592 39176 648 39350 643 570

12 Sri Lanka 24059 502 26517 487 34855 576 34960 572 595

13 Vietnam 10534 220 16787 308 26483 438 33132 542 362

14 Brazil 25024 522 29331 539 35281 583 31092 508

15 Belgium 28209 588 25436 467 33360 551 30552 500 395

16 Saudi Arab 27846 581 28982 532 28121 465 27240 445 440

17 Canada 20744 433 21817 401 27224 450 26915 440 481

18 Egypt 27441 572 23173 426 24379 403 26425 432 363

19 Japan 20175 421 21621 397 25604 423 24913 407 373

20 Pakistan 9358 195 30477 560 38944 644 23768 389 990

21 Other Countries 403426 8413 432970 7950 563520 9314 572377 9360 8660

GRAND TOTAL 1655147 34517 1799868 33051 2273044 37570 2302878 37660 36748

Source : Monthly Statistics of the Foreign Trade of India, DGCIS, Kolkata/Ministry of Commerce.

From the above table, it would be observed at USA, China Peoples Republic, United Arab Emirates, UK, Bangladesh,

German Federal Republic, France, Italy, Turkey, Spain, Netherland, etc. are major importers of our textile products.


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EXPORT PERFORMANCE OF MEMBER-MILLS :

Majority of our Member-Mills are exporting yarn, while some are exporting woven fabrics, knitted fabrics and knittedgarments too. The overall export performance of Member-Mills (those who reported) since 2005-06 has been as under:-

Value Rs. in LakhYear Yarn Woven/Knitted Knitted VSF Etc. Total

Fabrics Garments

2005-06 83304.35 6621.62 11014.46 10214.00 111154.43

2006-07 78802.64 8457.81 16764.61 17965.00 121990.06

2007-08 112528.25 25077.22 15451.04 28203.00 181259.51

2008-09 96910.76 10599.95 17937.36 20427.00 145875.07

2009-10 87776.35 11960.73 16868.91 28805.00 145410.99

2010-11 102019.36 16454.75 29865.18 31435.00 179774.29

2011-12 167583.68 20094.89 23938.25 39689.00 254305.82

2012-13 196772.92 60327.71 22497.01 44223.00 323820.64

2013-14 232911.25 63160.46 34170.33 44461.00 374703.04

2014-15 194939.00 41545.00 44059.33 45555.00 326098.00

The above figures would have been much higher had all the Member-Mills reported the export data to the Association.Member-wise details of exports during 2015-16 are given in Annexure-VIII and IX to this Report.

IMPORT OF TEXTILES IN THE COUNTRY :With the removal of quantitative restrictions on imports, Indian markets are floded with imported textile products. India’stextile imports have gone up substancially. The imports in Rupee terms increased by 18.68% in 2012-13 over 2011-12,by 9.88% in 2013-14 over 2012-13 and by 14.75% in 2014-15 over 2013-14.

The growth pattern of import of textile products (Chapters 50 to 63) in the Country for last four years are as under :-

Value Rs. in Crore/US$ in Million

Item 2012-13 2013-14 2014-15 2015-16

Qty. Value Qty. Value Qty. Value Qty. Value

Fibre Rs. 556.62 7511.08 444.04 7499.39 565.67 8966.82 618.11

$ 1379.19 1239.57 1466.36 1329.30

Fibre Waste Rs. 29.73 112.42 31.87 148.71 44.47 196.75 41.87

$ 20.64 24.58 32.17 33.31

Yarn Rs. 304.11 5612.43 307.52 6305.21 353.48 6802.49 346.86

$ 1030.56 1042.18 1112.42 992.85

Fabric Rs. 1448.72 6520.74 1454.47 7111.57 1936.47 7767.52 2161.43

$ 1197.35 1175.47 1270.24 1281.25

RMG Rs. 0.18 1783.28 0.16 2607.57 0.21 3206.51 0.29

$ 327.45 431.00 524.37 581.93


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Made-ups Rs. 568.76 2254.44 563.41 2273.92 640.72 3035.23 726.19

$ 413.96 375.85 496.36 549.01

Others Rs. - 5375.90 - 6106.48 - 6805.25 -

$ 987.13 1009.17 1112.88 1084.49

Total Rs. 29170.30 32051.86 36780.52

$ 5356.28 5297.83 6014.80 5852.14

Growth % Rs. 18.68 9.88 14.75

$ 4.49 (-)1.09 13.53 (-)2.70

Quantity of Fibre, Fibre Waste, Yarn, Made-ups are in Million Kgs., whereas Fabric is in Million Sq.mtrs. and RMG inMillion Numbers. Others have within sub-groups different units.

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47

TAXATION

PRE-BUDGET MEMORANDUM / HIGHLIGHTS OF UNION BUDGET 2016-17 :The Confederation of Indian Textile Industry (CITI), requested various Textile Industry Associations to provide inputs forPre-Budget Memorandum 2016-17 to be submitted by them to the Union Finance Minister. After collecting inputs fromvarious Textile Mills Associations, CITI submitted its proposals to the Union Textile Ministry, who submitted the followingproposals to the Union Finance Ministry on 2nd November, 2015 :-l Reduction of Excise Duty on MMF from 12.5% to 6%.l Removal of Special Additional Duty (SAD) of 4% on all types of MMF.l Rationalisation of SAD with CST/VAT and refund of SAD to cotton textile manufacturers.l Restoration of Interest Rate Subvention Scheme with wider scope covering entire value chain. Interest rates in

India are substantially higher (12-14%) than that of our competing countries (China – 5-6%; Vietnam – 6-7%).l Providing working capital @ 7% to exporters under priority sector lending.l Exemption of Service Tax on specific activities of Export Promotion Councils.l Reduction in Investment Allowance threshold limit from Rs. 25 crore to Rs. 5 crore excluding spinning.l Increasing eligibility for duty free imports of trimmings and embellishments for made-ups at par with garments.The Hon’ble Finance Minister presented Budget for 2016-17in the Parliament on 29th February, 2016. The main Highlightsof the Budget impacting the textile industry are as under :-

AMENDED TECHNOLOGY UPGRADATION FUND SCHEME (A-TUFS):l Fund allotted under the scheme Rs. 1480 crores.

CENTRAL EXCISE:l The optional Central Excise levy (zero or six percent) for cotton textiles continues.l Central Excise Duty at 2% (without Cenvat Credit) or 12.5% (with Cenvat Credit) is levied on readymade

garments and made-up articles when they bear or are sold under brand name and the RSP is Rs. 1000 andabove.- The tariff value for readymade garments and made-up articles is increased from 30% to 60%.- The levy shall not apply to retail tailoring establishments.- The brand name owner, who gets the goods manufactured on his own account on job work shall pay

the duty on such goods as if the goods were manufactured by him. However, the brand name owner willbe given the option to authorize his job worker to pay the duty.

l Excisable goods which were produced on or before 29th February, 2016 but lying in stock as on 29th February,2016 shall attract duty upon clearance. No stock declaration is required to be submitted to jurisdictional centralexcise authorities.

l Basic excise duty on PSF/PFY manufactured from plastic scrap or plastic waste including waste PET bottlesis being changed from 2% without Cenvat credit or 6% with Cenvat credit to 2% without Cenvat credit or 12.5%with Cenvat credit.

l Full exemption from Central Excise duty will be available to duty paid goods returned to the manufacturer duringa financial year upto an aggregate ceiling not exceeding 10% of the value of clearance for home consumptionmade in the previous financial year.

l Central Excise registration procedure has been simplified and the certificate will be granted within two workingdays.

l Post-registration physical verification of the premises has been done away with.l The period of limitation for initiating action by the Department increased from one year to two years.l Interest rate reduced to 15% from 18%.l Revised Return facility for Central Excise Assessees.l Penal proceedings against co-notices shall stand concluded on conclusion of proceedings against main notice.l Reduction in number of Returns.l Where invoices are digitally signed, manual attestation of copy of invoice meant for transporter is done away

with.l In case of finalization of provisional assessment, interest will be chargeable from originall date of payment of

duty.


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l All capital goods having value upto Rs. 10,000/- per piece have been included in the definition of INPUTS,implying that availing credit on such capital goods may deny the application of exemption Notification 30/2004dated 9th July, 2004 (optional zero rate of duty) for textiles.

l Cenvat credit on inputs and capital goods used for pumping of water, for captive use in the factory, has beenallowed even where such capital goods are installed outside the factory.

l Rule 6 of Cenvat Credit Rules which provides for reversal of credit in respect of inputs used in manufacture ofexempted and dutiable goods has been redrafted with the objective of simplifying and rationalizing the samewithout altering the established principles and reversal of such credit.

l An Annual Return is to be filed by a manufacturer of final products or provider of output services for eachfinancial year by the 30th of November of the succeeding year in the prescribed form.

l Prosecution of old cases involving duty of less than Rs. 5 Lakh and pending for more than 15 years to bewithdrawn.

l Indirect Tax Dispute Resolution Scheme – The salient features – the Scheme comes into force on 1st day ofJune, 2016; the declarations are to be made upto the 31st December, 2016; the ‘indirect tax dispute’ means thedispute which is pending before the Commissioner (A) as an appeal against the impugned order as on 1st

March, 2016. The declarant is required to pay tax due alongwith the interest thereon and penalty equivalent to25% of the penalty imposed in the impugned order, within 15 days of the receipt of the acknowledgement andintimate the designated authority within seven days of making such payment. On payment of tax, interest andpenalty, the designated authority shall within 15 days of the receipt of such proof, pass an order of discharge ofdues.

CUSTOMS:l Basic customs duty exempted on import of the following items, of value equivalent to 1% of f.o.b. value of

exports in the preceding financial year:Cotton and elastane blended printed fabrics, cotton and metallic yarn dyed blended fabrics, cotton and spandexand metallic blended fabrics, cotton and elastane printed fabrics, cotton and silk lining fabrics, 100% linenchambray woven/dyed fabric, 100% ramie dyed/blended printed yarn dyed fabcic, nylon and spandex liningfabcic, 100% polyester wet dyed fabric and cotton/nylon/embroidery crochet lace lining fabrics.

l Basic customs duty on the following fibres/filaments/yarn is reduced from 5% to 2.5%:Nylon 66 filament, polyester yarn – antistatic filament, aramid flame retardant fibre, para aramid fibre, nylonstaple fibre, nylon anti-static staple fibre, modacrylic fibre and flame retardant viscose rayon fibre.

l Interest rate on delayed payment rationalized @ 15%.

SERVICE TAX:l Rate increased to 15% with effect from 1st June, 2016 due to the new levy of Krishi Kalyan Cess @ 0.5% on the

value of taxable services. Credit of Krishi Kalyan Cess paid on input services shall be allowed to be used for thepayment of the said Cess on the services provided by a service provider.

l The limitation period for recovery of service tax in certain cases has been enhanced from 18 months to 30months.

l Interest at the rate of 24% shall be collected on the amount collected as service tax but not deposited by theperson collecting the service tax. Interest on delayed payment fixed at 15%. The monetary limit for filingcomplaints for punishable offences has been increased to Rs.2.00 crores.

l Refund of service tax on services used beyond the factory or any other place or premises of production ormanufacture for export is applicable from 1st July, 2012. The time period of one month is allowed to the exporterswhose claims of refund were earlier rejected.

l Services provided by Employees’ Provident Fund Organisation (EPFO) to employees are exempted from servicetax.

l Receipt of services availed from foreign shipping line by a business entity located in India will get taxed underreverse charge at the hands of the business entity (i.e.) import of goods by vessels is now liable to service tax.

l Annual Return to be filed by the assessee with a provision to file revised Return, delay to be penalized (Rs.100/day subject to maximum of Rs.20,000/-).


49

TRADE NOTICES, CIRCULARS, STANDING ORDERS, PUBLIC NOTICES, ETC.:Trade Notices, Circulars, Public Notices, Standing Orders, etc. issued by the Commissioner, Customs and CentralExcise, Indore/Bhopal, Central Board of Excise & Customs or the Ministry of Finance, Director General of ForeignTrade, Reserve Bank of India, etc., during the year in relation to Textile Industry were circulated to Member Mills, assoon as these were received/known.

STATE TAXES :The State Budget was presented in the Assembly on 26th February, 2016, but it did not provide any direct relief theTextile Industry. Certain important provisions in the Budget included the following :-l Assessees depositing tax of Rs. 6.25 crore quarterly or Rs. 25.00 crore annually have to deposit payable tax

by 6th day of the following month instead of 10th.l Delay in payment of tax beyond three months will attract penal interest @ 2% p.m. instead of 1.5%.

ENTRY TAX ON RAW MATERIAL :l Cotton (Ginned or unginned) included at Item No. 10 of Schedule – I of M.P. Entry Tax Act for exemption from

levy of Entry Tax w.e.f. 1st April, 2010.l Cotton waste included at Item No.10 in Schedule I of Madhya Pradesh Entry Tax Act, 1976 and exempted from

levy of Entry Tax w.e.f. 1st April, 2012 on regular basis.l Man-made fibres also included at Item No. 10A of Schedule I w.e.f. 1st April, 2013 and exempted from levy of

Entry Tax on regular basis.l Raw Wool was exempt from levy of Entry Tax, but Wool Tops were being taxed. Wool tops included in Schedule

I of M.P. VAT Act w.e.f. 2nd July, 2009, and exempted from levy of Entry Tax.l All types of yarn and yarn waste included in Schedule I and exempted from levy of Entry Tax w.e.f. 1st April,

2010 and 1st April, 2012 respectively.

ENTRY TAX ON CAPITAL GOODS FOR EXPANSION, ETC. :The Plant & Machinery and capital goods purchased before start of production does not attract Entry Tax, as perSection 3 of the Madhya Pradesh Entry Tax Act.Although the Industrial Promotion Policy-2004 provided for exemption from entry tax on goods specified in Schedule IIand III for use as incidental goods, but the Commissioner, Commercial Taxes, vide his circular dated 17th September,2009 advised Assessing Officers that in case of expansion/diversification purchase of Plant & Machinery and capitalgoods is in the course of business, such purchases are liable for entry tax. The Association has represented forwithdrawal of this circular several times, but no action is taken by the Government. However, in many cases theAppellate Authority and High Court of MP has held that such Plant & Machinery purchased for expansion beforecommencement of business under expansion are exempt from levy of Entry Tax.On 20th May, 2011, the Commercial Tax Department issued a Notification exempting Schedule-II goods brought in by aregistered dealer before start of production for expansion, modernization/diversification, etc., from levy of entry taxunder Industrial Promotion Policy, 2010 (w.e.f. 1st November, 2010).

ENTRY TAX ON INCIDENTAL GOODS :With an amendment to Schedule-II of Madhya Pradesh Entry Tax Act, purchase of Plant & Machinery attracted 2%Entry Tax, in 2012-13. This was rectified by an amendment to Section 4 of the Madhya Pradesh Entry Tax Act, 1976w.e.f. 1st April, 2013 and now Entry Tax @ 1% is payable on Plant & Machinery purchased by a registered dealer. Rateof Entry Tax on Natural Gas (including CNG) imported from other States attracts Entry Tax @ 10% w.e.f. 1st April, 2015.

CENTRAL SALES TAX ACT :Levy of CST continues at 2%. Section 15 of the Central Sales Tax Act was amended by Finance Act, 2011 w.e.f. 16th

April, 2011 increasing the rate of VAT leviable on declared goods from 4% to 5%.

VAT ON COTTON :On 3rd August, 2009, the Government of Madhya Pradesh, Commercial Taxes Department in exercise of powers conferredby sub-section (1) of section 26-A of the Madhya Pradesh VAT Act, 2002 notified “Cotton” purchased on or after the dateof Notification for the purpose of said sub-section. Impact of this Notification is that the Mills purchasing Cotton have todeduct the amount of VAT @ 5% (4% upto 15th April, 2011), while making purchases from dealers within the State ofMadhya Pradesh and the payment is to be made to the seller of cotton net of tax. The amount of tax so deducted isretained by a dealer making exports. However, certain formalities are to be completed in this respect and prescribedrecords are to be maintained.


50

The Association has been requesting the Government to notify “Cotton Waste” (raw material used by Open End SpinningMills), under Section 26-A of the Madhya Pradesh VAT Act, 2002, but no action is taken by the Government.

INPUT TAX REBATE :As per amendment to Section 14(1) yarn consumed in manufacture of fabric qualifies for input tax rebate of the amountof such input tax, which is in excess of 2% w.e.f. 1st April, 2013. Section 14(1)(6) has been amended with effect from 5th

April, 2016 in the case of inter-State sale of purchased material, the Input Tax Rebate will be limited to the amount ofinput tax or CST, whichever is less.

VAT ON RLNG :l RLNG used by industries for captive power generation (Section 14(1A)) is eligible for Input Tax Rebate of 8%

(13% - 5%) w.e.f. 1st August, 2009.l As per Section 14(1AA) w.e.f. 1st April, 2013, if the natural gas is used as fuel in manufacture or processing of

goods, then full input tax rebate is allowed.

VAT ON YARN :Present rate of VAT on yarn sold within the State is 5%, whereas the yarn sold in inter-State trade attracts CST @ 2%.Due to high rate of VAT the local consumers prefer to purchase yarn from other States paying CST @ 2%. We haverequested the State Government to reduce rate of VAT on yarn to 2%. By this reduction the State will not suffer any lossof revenue. Maharashtra has already reduced rate of VAT on cotton yarn to 2% w.e.f. 30th June, 2012. Rajasthan hasreduced it to 2% on all types of yarn w.e.f. 8th March, 2016 and Punjab has reduced it to 3.3% on all types of yarn andtheir waste w.e.f. 1st April, 2016. However, the State Government has not yet responded to our request.

VAT ON FABRICS :The State Government has exempted Fabrics from levy of VAT w.e.f. 1st April, 2006, by an amendment to Schedule I (ItNo.48) of MP VAT Act, 2002.

VAT ON OTHER ITEMS :l The general rate of VAT was raised from 4% to 5% (except for goods of special importance) w.e.f. 1st August,

2009. The VAT rate of 12.5% was increased to 13% w.e.f. 1st April, 2010 and to 14% w.e.f. 1st April, 2015.l Rate of VAT on Steam reduced to 5% (from 13%) w.e.f. 1st April, 2015.l Rate of tax on raw material used in manufacture of tax-free goods and in case of stock transfer outside the

State increased from 4% to 5% w.e.f. 1st April, 2015.

FORM – 49 :Till date Form No.49 has been made applicable for 56 items. The validity period of Form-49 has been reduced from 30days to 15 days w.e.f. 1st June, 2015.

STAMP DUTY :In the State Budget presented in the Assembly on 25th February, 2015, the State Government has stated that in case oftransfer of Industrial Units as a going concern, the transfer of Plant & Machinery and other moveable assets will attractmaximum Stamp Duty of Rs. 25 crore (which was earlier Rs. 10 crore).

MANDI TAX ON COTTON :The State Government reduced the rate of Mandi Tax applicable to un-ginned cotton brought in any Krishi Upaj Mandieither from within the State or from outside the State from Rs. 2 per Rupees one hundred to Rs. 1 per Rs. one hundred.This exemption has been extended upto 7th January, 2017.

IMPLEMENTATION OF GST IN THE TEXTILE SECTOR :The Ministry of Textiles commissioned a study by Ernst & Young and Wazir Advisors on the “Implications of GST forIndian Textile Industry”. A presentation of this Report was made at FICCI on 16th April, 2014. The Committee of CITI,which met at Mumbai on 30th April, 2014 also discussed the issue in detail and was of the opinion that introduction ofGST in textile sector could be implemented smoothly, if the lowest rate was stipulated for all textile products with noexemption for any segments or groups in the sector. This Report has been put on website of Ministry of Textiles on 8th

July, 2016.

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51

MANPOWER

INITIATIVES BY UNION MINISTRY OF LABOUR :l The Ministry of Labour issued a Office Memorandum on 17th December, 2014, inviting views of Stakeholders on

the Proposed amendments to Employees Provident Funds and Miscellaneous Provisions Act, 1952, by 30th

December, 2014. The Association submitted its section-wise suggestions/comments on 30th December, 2014.

l The Ministry of Labour uploaded Draft Labour Code on Wages, 2015 on its website in March, 2015. This Codeis to amalgamate Minimum Wages Act, 1948; Payment of Wages Act, 1936; Payment of Bonus Act, 1965 andEqual Remuneration Act, 1976. The suggestions/comments on this Draft were to be submitted by 20th April,2015. The Association submitted its suggestions/comments on 13th April, 2015.

l The Ministry also uploaded Draft Labour Code on Industrial Relations on its website on 27th April, 2015. ThisCode proposes to amalgamate Trade Unions Act, 1926; Industrial Employment (Standing Orders) Act, 1946and Industrial Disputes Act, 1947. Suggestions / comments of Stakeholders were invited by 26th May, 2015.The Association submitted its suggestions / comments on 21st May, 2015.

l The Ministry of Labour is administering 44 Labour Laws and is in the process of developing a single unified webportal as a part of their endeavour to ensure simplification of formats, ease of compliance, transparency ininspections and speedy redressal of grievances.

l The Union Ministry of Labour & Employment has put on its website Draft Amendment Proposals to the FactoriesAct, 1948 on 16th September, 2015. Various sections relating to Definition of Occupier, Health and SafetyMeasures, period of work, etc., are proposed to be amended. A new chapter on Occupational Safety & HealthBoard of India is proposed to be introduced to take care of health and safety issues. The Ministry has not givenany specific date for submission of comments/objections.

REFORMING LABOUR LA WS :The Expert Committee to the Ministry of Textiles in its Report “Vision, Strategy & Action Plan for Indian Textile &Apparel Sector” has stated that the present labour laws are one of the major reasons for modest success in this labourintensive industry. In order to attract large scale investment, acquire global scale and bring Indian Sector at par withcompeting countries like Vietnam and Bangladesh, etc., it has suggested need of immediate review of 44 labour laws,most of which were drafted in earlier part of the last century. Textile Ministry has suggested that –l Increasing the overtime limit from 50 hours to 100 hours.l Allowing women workers to work at night, especially in garment factories.l Overtime wage be one and half times the regular rate in accordance with ILO Convention, instead of double the

normal rate.Textile and garment sector is employing around 45 million people and around 70% of the garment sector employees arewomen.

46TH SESSION OF INDIAN LABOUR CONFERENCE :The 46th Session of Indian Labour Conference concluded on 21st July, 2015 at New Delhi, whereat Shri BhandaruDattatreya, Union Labour Minister, reiterated the Government’s commitment to reform the process with tripartite consensusto promote the employment generation at a massive scale particularly for the aspiring youth of the Country. Some of themajor recommendations of the Conference Committee are as under :-l ESIC to expand to cover all States/UTs.l ESIC should directly run health services in all the States.l ESIC coverage for round the clock for medical benefits.l Medical scheme to EPS Pensioners from surplus corpus of EDLI Scheme.l Extension of coverage of EPF by reducing threshold from 20 to 10.l EPF Pension should be enhanced and linked with price index.l Wages definition should be uniform for all labour laws.l There should be a mechanism, so that employers can deposit Social Security Contributions at a single window.


52

INDUSTRIAL RELATIONS :By and large industrial relations in the Member-Mills remained peaceful and cordial during the year.

LABOUR POLICY OF THE STATE :The Labour Policy-2007 of the State was issued on 29th June, 2007, the highlights of which of interest to Textile Industryare as under :-

l Efforts to be made to train the workers with co-ordination of Department of Industries and Department ofTechnical Education for the industries.

l Considering the global competitiveness preference to be given to the industry which can employ maximumworkers and help development of ancillary industries, Extra concessions and facilities will be provided to suchindustries.

l Strict compliance of Provisions of Contract Labour (Regulations & Abolition) Act to be ensured.

l Provisions of MP Industrial Relations Act, 1960 to be reviewed.

l Demands raising unnecessary disputes not to be considered.

l Closure and layoff to be allowed considering the advantage and disadvantages.

l Powers to renew licenses under the Factories Act, 1948 to the factories employing upto 500 workmen to bevested with Joint Director / Deputy Director.

l The three stage inspection system to be abolished except in hazardous and most hazardous factories.

l Labour Courts to be placed under the State High Court.

MADHYA PRADESH LABOUR ADVISORY BOARD :Shri S. Pal, Director, Vardhman Group, continues to represent on the Board.

THE MADHYA PRADESH LABOUR WELF ARE BOARD :The Madhya Pradesh Labour Welfare Board is constituted for a term of three years. Even though our Association hasnot been given direct representation on the Board, but Shri S. Pal, Director, Vardhman Group, has been nominated asEmployers’ representative.From 2nd February, 2013 the rate of contribution to Labour Welfare Fund was increased to Rs.10 per employee payableevery six months and the employers’ contribution to Rs. 30 per employee payable payable for every six months. Theminimum employers’ contribution shall not be less than Rs. 1500 for each of the half year. The employees drawing uptoRs. 10000 p.m. have been included.

DIVISIONAL ADVISORY COMMITTEES OF LABOUR WELF ARE BOARD :The Divisional Advisory Committees of the Labour Welfare Board continued to function in the State. Shri S. Pal, Director,Vardhman Group, is on Bhopal Divisional Committee and Shri P. D. Sharma of Pratibha Syntex Limited on IndoreDivisional Committee.

PAYMENT OF WAGES ACT, 1936 :The Central Government has specified Rs. 18000 p.m. as the wages under section 1(6) of the Act, effective from 11th

September, 2012.

THE MINIMUM WAGES ACT, 1948 :No amendments were made to the Act during the year. As per State Government Notification dated 2nd July, 2014, ShriS. Pal was nominated as employers’ representative on the State Minimum Wage Advisory Board. Since Shri Palceased to be Chairman of the Association, Shri Suresh Maheshwari, President, Maral Overseas Limited, our Dy.Chairman, was nominated in place of Shri S. Pal w.e.f. 4th February, 2015.


53

The State Government, vide its Notification dated 29th September, 2014 revised minimum wages from 1st October. 2014.(Published in M.P.Gazette on 10th October, 2014). The details of proposed and existing wages are as under :-

Category Revised Pre-revised % Increase

p.m. p.d. p.m. p.d.

Highly Skilled Rs. 9735 Rs. 374 - - 57.65

Skilled 8435 324 Rs.6175 Rs.238 36.60

Semi Skilled 7057 271 6025 232 17.13

Unskilled 5939 228 5895 227 0.75

Dearness Allowance based on average of All India Consumer Price Index for January-June, 2014 (241 points) wasincluded in above revision. Any rise above this will be compensated half yearly based on average rise in July-Decemberand January-June Index @ of Rs. 25 per point.Various Industry Associations including our Association challenged this decision in Madhya Pradesh High Court, IndoreBench on various grounds. By the judgment delivered on 9th July, 2015, the petitions were dismissed stating that thesewere devoid of merit.The Labour Department of the State again vide its Notification dated 15th May, 2015 (published in Madhya PradeshGazette on 22nd May, 2015) revised the minimum wages of unskilled workers from Rs. 240.00 per day to Rs. 250.00 perday with effect from 1st June, 2015. This is inclusive of Dearness Allowance declared w.e.f. 1st April, 2015.Thus the Minimum Wages payable to various categories of workmen w.e.f. 1st October, 2014 onwards have been asunder :-

Highly Skilled Skilled Semi Skilled Unskilled

p.m. p.d. p.m. p.d. p.m. p.d. p.m. p.d.

1st October, 2014 Rs. 9735 Rs.374 Rs.8435 Rs.324 Rs.7057 Rs.271 Rs.5939 Rs.228

1st April, 2015 10035 366 8735 336 7357 283 6239 240

1st June, 2015 10035 366 8735 336 7357 283 6500 250

1st October, 2015 10110 389 8810 339 7432 286 6575 253

1st April, 2016 10385 399 9085 349 7707 296 6850 263

VARIABLE DEARNESS ALLOWANCE UNDER SETHI AWARD :For the employees of the Textile Mills, who were signatories to the submissions made to Shri P. C. Sethi, the then ChiefMinister of Madhya Pradesh, the rate of Dearness Allowance changes every quarter depending upon the rise or fall inthe Consumer Price Index Number. Variable dearness allowance underwent the following changes during the year2015-16 :-

Quarter For Indore, Ujjain, Nagda, Ratlam, Dewas, For Bhopal Centre

Sanawad, Khandwa and Burhanpur Centres

April-June 2015 Rs. (+) 19.44 Rs. (-) 10.71

July-September 2015 (+) 137.16 (+) 71.40

October-December 2015 (+) 134.30 (+) 221.08

January-March 2016 (+) 52.93 (+) 135.99

April-June 2016 (-) 123.49 (-) 104.61


54

CONSUMER PRICE INDEX :The Consumer Price Index Numbers for Industrial Workers (Base 2001 = 100) of All India and various Centres in MadhyaPradesh during the year 2015-16 have been as under :-

All India Indore Bhopal Chhindwara Jabalpur

Linking factor to 1982 series 4.63 4.73 4.83 4.03 4.53

January, 2015 254 235 254 253 244

February 253 234 252 250 244

March 254 238 255 254 247

April 251 239 254 255 249

May 258 241 256 255 253

June 261 243 258 260 255

July 263 243 262 260 255

August 264 247 263 265 258

September 266 248 264 275 258

October 269 249 268 271 268

November 270 249 268 269 269

December 269 246 266 272 269

January, 2016 269 244 267 273 269

February 267 243 262 274 269

March 268 243 263 274 271

PAYMENT OF BONUS ACT, 1965 :The Payment of Bonus Act was amended vide Notification dated 31st December, 2015 and amendments made applicablefrom financial year 2014-15 :-l Eligibility limit of salary or wage for payment of Bonus raised to Rs. 21,000 per month (section 2 (13)).l Ceiling of salary or wage for calculation of bonus raised to Rs. 7,000 per month or minimum wages, whichever

is higher (section 12).l Minimum bonus payable @ 8.33% of salary or wage continues.The Labour Commissioner, Indore, vide his Circular dated 17th March, 2016 directed his Field Formations to ensurepayment of arrears of Bonus for the year 2014-15 under Payment of Bonus (Amendment) Act, 2015. The Association ofIndustries Dewas filed a writ petition against retrospective amendment of Payment of Bonus Act in Indore Bench of M.P. High Court. The High Court vide its judgment dated 11th April, 2016 granted interim relief and directed that until furtherorders, the impugned Notification dated 1st January, 2016 of Government of India shall remain effective only from thefinancial year 2015-2016 and no coercive action shall be taken against the petitioner in respect of the period prior to 31st

March, 2015. The High Courts of Kerala, Karnataka, Allahabad, Madras, Rajasthan, Gujarat and Bombay have alsopassed similar orders.

EMPLOYEES’ COMPENSATION ACT, 1923 :Now, the Workmen’s Compensation Act, is known as Employees’ Compensation Act. The salient features of the Actare :-l The Minimum amount of compensations on death of an employee – Rs. 1,20,000.l Permanent Disability Compensation – Rs. 1,40,000.l Funeral Expenses – Rs. 5,000.l Specified Rs. 8,000 as monthly wages for the purpose of Section 4(1).


55

EMPLOYEES’ PROVIDENT FUND AND MISC.PROVISIONS ACT, 1952 :l Ceiling for coverage under the Act increased to be Rs. 15,000 per month w.e.f. 1st September, 2014. The benefit

under EDLI increased by 20% w.e.f. 1st September, 2014.

l From 1st January, 2015, the rate of Provident Fund Administrative Charges has been reduced to 0.85% onProvident Fund Contributions. From 1st January, 2015, Minimum Administrative Charges under A/c, II for non-functioning establishments are now Rs. 75/- p.m. and for the operational establishments/factories. MinimumAdministrative Charges are Rs. 500/- p.m. Under EDLI Scheme present Minimum Administrative Charges areRs. 25/- p.m. for non-functional establishments/factories and for operational establishments/factories are Rs.200/- p.m.

l On 2nd January, 2015, EPFO has revised Declaration Form-11, which also replaces Form-13.

l Now Forms 19, 10-C and 31 can be submitted directly by employees (having UAN activated) without attestationfrom employer.

l Universal Account Number (UAN) has been made mandatory vide Notification dated 22nd June, 2015.

l On 10th February, 2016, the Union Ministry of Labour & Employment has issued Notification regarding twoIncentive Refund Schemes in respect of EPF Administrative Charges deposited by employers for providingUniversal Account Numbers to all employees, which are –

- Scheme A – 10% refund of administrative charges for providing details in Form No.11 seeding Aadhar(atleast 80%), Bank Account (100%) and PAN, where applicable.

- Scheme B – 5% refund of administrative charges for providing member details in Form No.11 seedingAadhar 70%, Bank Account 80% and PAN, wherever applicable.

l EPFO decided not to credit interest with effect from 1st April, 2011, to the accounts in which no fresh contributionshave been received during the last three years. However, interest will be credited to such accounts from April,2016 again.

l The benefit under EDLI has been raised vide Notification dated 24th May, 2016. Now it is 30 times of the averagesalary drawn in preceeding 12 months plus 50% of average balance in the account of the deceased subject toa ceiling of Rs. 1,50,000/- and total ceiling of Rs. 6,00,000/-.

l The Income Tax Department has directed Employees Provident Fund Organisation to deduct tax (TDS) fromthe withdrawal amount, if the withdrawal happened before completing five years of subscription and exceeds orequals to Rs. 50,000/- (Rs.30,000/- upto 31st May, 2016) if the member fails to submit PAN and Form 15G or15H. In case PAN is submitted, the deduction will be @ 10% and no deduction if Form No. 15G or 15H issubmitted. This is effective from 1st June, 2016.

l The EPFO decided to pay interest @ 8.80% on provident fund balances in the accounts of individual membersfor the year 2015-16.

EMPLOYEES’ PENSION SCHEME, 1995 :

Minimum Pension of Rs. 1,000/- p.m. is payable in respect of a member and widow(er) / nominee / dependent parents,whereas children and orphan pension of Rs. 250/- p.m. and Rs. 750/- p.m. respectively is payable w.e.f. 1st September,2014, the Central Government approved continuation of disbursement of minimum pension beyond 2014-15. Pensionerswho superannuated at the age of 58 years with 20 years pensionable service (contributory service) have been allowedtwo years wightage w.e.f. from the date of start of pension to them as per Circular dated 25th July, 2016 by the EPFO.

On 26th March, 2015, the Ministry of Labour & Employment issued two Notifications, one making amendment to para 9of the Scheme, substituting words “actual service” with “contributory service” and another making provision of widowpension for the widows of contributors having salary of Rs. 6550 to Rs. 15000 on day of death.

Ministry of Labour & Employment issued a Notification on 1st April, 2016 inserting Sub-Para (4) in Para (16) providing forpayment of monthly orphan pension to each orphan till such orphan attains the age of 25 years. If the orphan is sufferingfrom mental disability or disorder or is physically crippled or disabled such pension shall be payable even beyond theage of 25 years.


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As per Gazette Notification dated 25th April, 2016, individuals who have completed 10 years of service and put off thewithdrawal of pension on attaining the age of 58 years, will earn an increase of 4% in pension for each year upto 60years (i.e., 4% in case of one completed year and 8.16% in case of two completed years).

As per Order dated 23rd June, 2016, employees whose details (Aadhar Number and Bank Account Number, etc.) havebeen seeded in their UAN and whose UAN has been activated may submit their pension claims in Form 10-D-UANdirectly to Commissioner without attestation from their employers.

EMPLOYEES’ STATE INSURANCE ACT, 1948 :

l Wage ceiling for ESI eligibility is Rs. 15000 p.m. (excluding overtime work) w.e.f. 1st May, 2010.

l For any disabled employee appointed after 1st April 2008, the employer’s share will be paid by Central Governmentfor three years.

l Confinement Expenses under Rule 56(a) increased to Rs. 5000 w.e.f. 1st October, 2013.

l Daily benefit rate for commutation under Rule 76(b) increased to Rs. 10 and maximum commuted value to Rs.60,000 w.e.f. 1st June, 2013.

l Benefit of Rule 60 to be extended to the spouse of insured person/woman, who cease to be in insurableemployment on account of permanent disablement (full or partial) till the date of superannuation of such insuredperson, had he not sustained such disablement (Notification dated 3rd March, 2014).

l ESI Corporation notified on 3rd March, 2014 a new Amnesty Scheme 2014 for withdrawal of cases filed againstthe Insured Persons and Employers under Sections 84, 85 and 85A of ESI Act, 1948 and also settlement ofcases filed by Employers under Section 75 of the Act. Scheme provides for withdrawal of all prosecution casesfiled upto 31st December, 2013. The Scheme was in force from 28th January, 2014 to 27th November, 2015.

l ESI Corporation vide its office memorandum dated 22nd September, 2015, has enhanced the amount of periodicalpayment of Disablement and Dependent’s Benefits, where the employment injuries resulting in disablement ordeath occurred on or before 31st December, 2012.

l ESI Corporation vide its Circular dated 30th November, 2015 has granted increase to compensate the erosion inreal value of PDB/DB fall due to inflation and where the beneficiary was in receipt of minimum amount ofRs.1200, he/she would be entitled to arrears with effect from 1st August, 2013.

l ESI Corporation has issued a Memorandum on 8th April, 2016, whereby it has advised its Officers to claiminterest on contributions on omitted wages in the same manner as claiming interest on regular contributionunder Section 39 (5) of the ESI Act read with Regulation 31. Prior to above instructions, the interest on left outwages/omitted wages, where the number of employees, employee-wise details of wages paid and period ofengagement was not available, the interest was to be claimed after allowing grace period of 21 days from thedate of demand.

l Vide Notification dated 12th April, 2016, the ESI Corporation have issued instruction for implementation ofAadhar based authentication of beneficiaries under the Act.

l ESI Corporation has circulated on 11th April, 2016, its Inspection Policy for Start-up Units as defined by Departmentof Industrial Policy & Promotion (DIPP). Such units will be allowed to submit self certified returns (as is beingdone under Shram Suvidha Portal).

l ESI Corporation has advised all its Regional Offices on 31st May, 2016, to implement ESI Act in the Districts,where it is not implemented.

l Exemption limit for payment of employees contribution raised to Rs.137.00 (from Rs.100.00) w.e.f. 14th June,2016.

l ESI Corporation has introduced Annual Preventive Health Check-up Programme for all insured persons underESI Scheme and are of 40 years and above age.


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RAJEEV GANDHI SHRAMIK KAL YAN YOJNA :“Rajeev Gandhi Shramik Kalyan Yojna” introduced w.e.f. 1st April, 2005 under which persons insured under ESI Act onleaving insurable employment in voluntarily or on account of closure of the factory or establishment, retrenchment orpermanent invalidity arising out of non-employment injury, after being in an insurable employment and contributed underthe Scheme for five or more years (reduced to three year w.e.f. 11st September, 2009), are entitled to claim unemploymentallowance for a maximum period of twelve months during his/her entire service period. Medical facilities are also availableto families of insured during this period. For availing unemployment allowance, the condition of permanent disability of40% and more arising out of non-employment injury has been prescribed.

INDUSTRIAL DISPUTES ACT, 1947 :The Government of Madhya Pradesh has notified The Madhya Pradesh Labour Laws (Amendment) and MiscellaneousProvisions Act, 2015 on 27th November, 2015. With this Notification, following changes have been made, which havecome into effect from 27th November, 2015 :-l Section 2-A. In Sub-Section (3) “Conciliation Officer” has also been added.l Section 25F .

a) For retrenchment, three months notice to a workman to be retrenched is now required as against onemonth’s notice earlier.

b) At the time of retrenchment a worker has to be paid 15 days average pay for every completed year ofcontinuous service or any part in excess of six months or an amount equivalent to three monthsaverage pay, whichever is more.

l Section 25K.Now the provisions of Chapter V-B will apply to an establishment in which not less than 300 workmen areemployed on an average per working day for preceding twelve months. Earlier it was applicable in case ofestablishments employing not less than one hundred workmen.

MADHYA PRADESH INDUSTRIAL EMPLOYMENT (STANDING ORDERS) ACT,1961 / RULES, 1963 :l From 27th August, 2008, a workman, who is required to work on any of the paid holidays, is to be given a

substituted holiday in lieu of his working or he will be entitled to double the normal wage rate for extra workdone.

l With effect from 29th August, 2008, the State Government has increased paid holiday to nine by addingVishwakarma Jayanti.

l Labour Department of the State vide Notification dated 28th June, 2014, has revised upwards retirement age ofworkmen from 58 years to 60 years by amending serial No. 14-A in Annexure to M.P. Industrial Employment(Standing Orders) Rules, 1963. On 25th October, 2014, the State Government issued two Ordinances accordingto which this Act and the Rules will not apply to Micro Industries. These will apply to establishments employingmore than 50 workmen. These Ordinances have been converted to the Act on 29th December, 2014.

FACTORIES ACT, 1948 :l Considering our request, the State Government vide Order dated 23rd June, 2011, allowed employment of

women workers in all the shifts in the Textile Industry (including in night shifts from 10:00 P.M. to 5:00 A.M.).The Order states that since Section 66(1)(b) of the Factories Act, 1948 has been held to be ultra-vires byMadras High Court and no appeal has been filed against this judgement, the State Government has permittedemployment of women workers in night shifts. Employers engaging such women workers in the night shifts arerequired to adhere to certain conditions specified in the Order.

l State Government has notified on 24th June, 2016 conditions for ensuring Safety of Women Workers required towork between 8.00 PM to 6.00 AM.

l The State Government has notified The Madhya Pradesh Labour Laws (Amendment) and Miscellaneous ProvisionsAct, 2015 on 27th November, 2015. With this Notification, following changes have been made, which have comeinto effect from 27th November, 2015 :-

l Section 65 .Sub-Section (2) - The power given to the Chief Inspector to exempt factories from provisions of Sections 51, 52,54 and 56 has been withdrawn.


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l Sub-Section (3).It has substituted by a new Sub-Section, which provides for :-An adult worker may be allowed to work more than 48 hours in a week subject to the following :-a) Total number of hours in a day shall not exceed twelve and the spread over inclusive of interval of rest

shall not exceed thirteen hours in a day.b) Total number of working hours in a week including overtime shall not exceed 60 hours.c) No worker will be allowed to work overtime for more than seven days at a stretch and total hours of

overtime in a quarter shall not exceed one hundred and twenty five hours.l Section 79 .

Every worker who works in a factory for 180 days in a calendar year will be allowed during the same calendaryear leave with wages :a) One day for every 20 days of work performed to an adult worker.b) One day for every 15 days of work performed to a child worker.The working of 180 days will include days of layoff, maternity leave to female workers (not exceeding twelveweeks) and the leave earned in the year prior to that in which leave is enjoyed.

BUILDING & OTHER CONSTRUCTION WORKERS WELF ARE CESS ACT, 1996:The State Government has notified The Madhya Pradesh Labour Laws (Amendment) and Miscellaneous Provisions Act,2015, whereby following amendment have been made effective from 27th November, 2015 :-l Section 3(1).

The cost of purchase, transportation and such other costs of plant and machinery meant for use in factory willnot be added and will be excluded from cost of construction for levy of cess.The detailed Notification in this respect has been issued on 24th June, 2016 specifying various items to beexcluded from cost of construction.

l Section 1 1(1).Employer aggrieved by an Order of Assessment under Section 5 of the Act or an order imposing penalty, mayfile appeal to the authority notified under the Act.The manner in which appeal is to be preferred has been notified on 24th June, 2016.

MADHYA PRADESH INDUSTRIAL RELATIONS ACT, 1960 :l The State Government vide Notification dated 14th August, 2007 has removed eleven categories of industries

(including textile industry) from the purview of Madhya Pradesh Industrial Relations Act, 1960 w.e.f. 17th August,2007 by invoking section 1 (4) of this Act.

MATERNITY BENEFITS ACT, 1961 :l Medical Bonus payable to a working woman under section 8 of the Act has been increased to Rs. 4000 w.e.f.

2nd April, 2008. The Central Government is empowered to raise this amount to maximum of Rs. 20,000.

PAYMENT OF GRATUITY ACT, 1972 :l With an amendment to Payment of Gratuity Act w.e.f. 3rd April, 1997, the definition of “Employee” under section

2 (e) of the Act includes all the employees, who are employed for wages.l With effect from 24th May, 2010, the ceiling on amount payable under the Act has been increased to Rs. 10.00

lakh.

MADHYA PRADESH PROFESSIONAL TAX ACT, 1995 :With effect from 1st April 2013, the exemption limit applicable to salaried employees of Rs. 1,80,000 per annum continues.


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SEXUAL HARASSMENT OF WOMEN AT WORK-PLACE (PREVENTION,PROHIBITION & REDRESSAL) ACT, 2013 :This is an Act to provide protection against sexual harassment of women employees at workplace and for preventionand redressal of complaints of sexual harassment and matters connected therewith. This Act and Rules made thereunderhave been made applicable from 9th December, 2013.

APPRENTICES ACT, 1961 :With effect from 29th September, 2014, the apprenticeship allowance payable under Rule 11 (1) clause (a) (b) (c) (d) ofApprences Act has been revised as under :-

During 1st year of training - 70% of Minimum Wages notified by respective State or UT.During 2nd year of training - 80% of Minimum Wages notified by respective State or UT.During 3rd year of training - 90% of Minimum Wages notified by respective State or UT.

The Government of India revised the Apprenticeship Allowance payable under Apprenticeship Rules, 1992 with effectfrom 19th December, 2014, as under :-

Graduate Apprentices : Rs. 4,984/- p.m.Sandwich Course (Students from Degree Institutions) : Rs. 3,542/- p.m.Technician Apprentices : Rs. 3,542/- p.m.Sandwich Course (Students from Diploma Institutions) : Rs. 2,890/- p.m.Technician (Vocational Apprentices) : Rs. 2,758/- p.m.

On 16th June, 2015, the Government has notified amendments to Apprenticeship Rules, 2015.

VOLUNTARY COMPLIANCE SCHEME OF THE STATE GOVERNMENT :The State Government has notified on 7th October, 2014, Voluntary Compliance Scheme (VCS) for the benefit of industrialand commercial establishments. A unit opting for the Scheme has to file two Annual Returns and maintain only oneRegister in respect of 16 labour laws. Those joining the Scheme have to provide security deposit in the form of BankGuarantee/Cash Deposit for 5 years ranging between Rs. 5,000/- to Rs. 50,000/- based on number of workers, whichmay be revised after three years. Notification regarding Alternate Forms for maintaining Registers and Records andFurnishing Returns under the Scheme has been issued on 24th June, 2016.

IMPORTANT DECISIONS OF COURTS :The Association has been circulating regularly the summary of important decisions of the Supreme Court and the HighCourts on labour matters. The quarterwise summary is made available to the Member-Mills. Certain important decisionsare also being circulated separately and gist of some others included in the Monthly News Letters.

EMPLOYMENT IN TEXTILE SECTOR :The direct employment in the textile industry during previous six years has been as under :-

Country as whole 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16a. Public Sector Units – Central 21198 21251 19883 19384 19384 State 60241 59710 57771 57456 57456b. Co-operative Sector 87196 87437 88597 88704 88721 873101c. Private Sector 672147 689754 698311 696633 700618d. SSI – Units 53616 54085 53874 53677 54268 54710e. Weaving Mills (Non-SSI) 28583 31557 33403 34205 34205 43783f. EOUs 47376 7272 6484 4800 5174g. Power Looms 5706860 5745942 5833457 5917510 6187500 6308161State of Madhya Pradesh:a. Public Sector Units – Central 409 713 711 353 353 State 1559 1559 1559 1559 1559b. Co-operative Sector 1800 1800 1786 1786 1786 67164c. Private Sector 50414 53412 55146 59062 59325d. SSI – Units 173 163 133 310 342 340e. Weaving Mills (Non-SSI) 325 420 420 420 420 463f. EOUs 2025 1041 358 353 358 358g. Power Looms 290212 295543 312133 316697 333562


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Mill-wise Employees on Rolls as on 31st March, 2016, are given in Annexure – XII.

TEXTILE WORKERS REHABILIT ATION FUND SCHEME :This Scheme provides interim relief to workers, who have been rendered jobless as a consequence of permanentclosure of any particular portion or entire textile unit in which they are employed. Workers are entitled to get relief to theextent of 75% of wage equivalent in the first year, to the extent of 50% of wage equivalent in the second year and to theextent of 25% of wage equivalent in the third year. The position of disbursement under the Scheme is as under :-

India as a Whole Madhya Pradesh

As on As on As on As on As on As on

31.03.14 31.03.15 31.03.16 31.03.14 31.03.15 31.03.16

No. of Mills 92 94 95 5 5 5

Workers eligible 147195 147905 150563 19800 19800 19800

Workers paid 115984 116958 117696 19033 19033 19033

Amount paid (Rs. in Crore) 313.42 316.20 317.98 53.08 53.08 53.08

Workers of closed Hukamchand Mills Ltd., Indore, Shri Binod Mills Ltd., Ujjain (including Bimal Mills), Shree SyntheticsLtd., Ujjain, Bharat Commerce & Industries Ltd., Nagda and Hind Syntex Ltd., Dewas were paid under the Scheme.

TEXTILE SECTOR SKILL COUNCIL :The Textile Sector Skill Council (TSC) was set up on 22nd August, 2014 under the aegis of National Skill DevelopmentCorporation and promoted by CITI, 14 leading Textile Industry Associations (including MPTMA) and Export PromotionCouncils. It is committed to develop World Class Skilled Manpower for all segments of Textile Industry. It is undertakingfollowing tasks :-l Develop Standard Work Methods for various jobs.l Assist Textile Units to establish right kind of training infrastructure.l Facilitate to train a pool of Certified Trainers to meet industry requirements.l Maintain and provide trained manpower data base to the employers.The TSC has stardardised 56 jobs, which cover more than 80% of the workers in the Industry. 3.75 lakh youth have beentrained in the textile trades and 70% of the trainees have been provided the jobs.

MISCELLANEOUS :Three Apparel Training & Design Centres (Sponsored by Apparel Export Promotion Council and Ministry of Textiles) arefunctioning at Indore, Dewas and Chhindwara in the State. National Institute of Fashion Technology sponsored byMinistry of Textiles is working at Bhopal since 2008.

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POWER

Electricity generation, transmission, distribution, supply, captive power generation, determination of power tariff etc.,are regulated in the State under the provisions of the Madhya Pradesh Vidyut Sudhar Adhiniyam, 2000, which is in forcewith effect from 3rd July, 2001 alongwith provisions of the Electricity Act, 2003 and Rules made thereunder.

POWER TARIFF 2016-17 :The Madhya Pradesh Power Management Co. Ltd. and the three DISCOMs submitted their Annual Revenue Requirementsand Tariff proposals for 2016-17 to MPERC in December, 2015. The Commission invited comments/suggestions onthese proposals by issuing Public Notices in Newspapers on 17th January, 2016, latest by 29th January, 2016. TheElectricity Consumers’ Society and the Association submitted comments/suggestions in last week of January, 2016.Public hearings were held at Jabalpur, Indore and Bhopal on 12th, 16th, and 19th February, 2016 respectively. At Indorehearing, our case was presented by Shri P. L. Nene, President, Electricity Consumers Society submitted varioussuggestions. The MPERC notified Tariff for 2016-17 on 5th April, 2016, which has been made applicable from 13th April,2016.

A comparative Statement of Tariff (HV-3.1:Industrial) applicable to Textile Industry for the years 2015-16 and 2016-17 isgiven below :-

S.No. Item 2015-16 2016-17(1) (2) (3) (4)

1 Fixed Charges (Rs./KVA of Billing

Demand) 11 KV Supply Rs. 280.00 Rs. 300.00

33 KV Supply 435.00 470.00

132 KV Supply 525.00 560.00

220 KV / 400 KV Supply 560.00 590.00

2 Energy Charges (Rs./Unit) Upto 50% LF In Excess of Upto 50% LF In Excess of

50% LF 50% LF

11 KV Supply Rs. 5.75 Rs. 5.20 Rs. 6.20 Rs. 5.55

33 KV Supply 5.65 4.70 6.10 5.10

132 KV Supply 5.25 4.55 5.70 4.85

220 KV / 400 KV Supply 5.05 4.35 5.45 4.65

3 Power Factor Incentive on EC

Above Upto

95% 96% 1% 1%

96% 97% 2% 2%

97% 98% 3% 3%

98% 99% 5% 5%

99% 7% 7%

4 Power Factor Penalty

For each 1% decrease in average

monthly power factor

Below 90% 1% on EC for each 1% fall 1% on EC for each 1% fall

“ 85% 5% + 2% for each 1% fall 5% + 2% for each 1% fall

“ 70% Disconnection Disconnection


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(1) (2) (3) (4)

5 Load Factor Incentive

LF < = 75% No incentive No incentive

LF > = 75% 0.10% for every 1% increase 0.10% for every 1% increase

in LF above75% on EC for in LF above 75% on EC for

incremental consumption incremental consumption

above 75% L.F. above 75% L.F.

6 Annual Minimum Consumption

11 KV / 33 KV 1200 Unit / KVA 1200 Unit / KVA

132 KV / 220 KV 1800 Unit / KVA 1800 Unit / KVA

7 Billing Demand Actual Maximum KVA or 90% of Actual Maximum KVA or 90% of

CD whichever is higher CD whichever is higher

8 Load factor calculation Monthly Cons. X 100 Monthly Cons. X 100

No. of Hrs. in Billing No. of Hrs. in Billing

Month X Demand X P.F Month X Demand X P.F

9 Time of Day Surcharge / Rebate

6 PM to 10 PM Surcharge 5% of Normal E.C. Normal Rate of E.C.

10 PM to 6 AM Rebate 15% of Normal E.C. 20% of Normal E.C.

10 For excess demand :

a) Energy Charges 1.30 times the tariff No Extra Charge

b) Fixed Charges (i) 1.30 times the charges (i) 1.30 times the charges

for demand over 105% for demand over 105%

of CD when MD is upto 115%. of CD when MD is upto 125%

(ii) 2 times the charges (ii)2 times the charges (when

(when MD exceeds 115%)for MD exceeds 125%)for demand

demand recorded over and above recorded over and above

15% of CD in addition to (i) above. 15% of CD in addition to (i) above.

11 Delayed Payment Surcharge @ 1.00% p.m. or part thereof @ 1.00% p.m. or part thereof

on outstanding amount. on outstanding amount.

WHEELING CHARGES & CROSS SUBSIDY SURCHARGE ON OPEN ACCESS :Vide its Order dated 5th April, 2016, the MPERC fixed wheeling charges of 27 paise per unit for the year 2016-17. Thisorder also prescribed cross subsidy surcharge, which is difference between category wise average tariff minus scenariowise cost per unit. For 132 KVA Supply it works out to Rs. 1.44 per unit. Cross Subsidy Surcharge shall not exceed20% of the average tariff applicable to the category of consumer seeking open access. The Electricity Consumers’Society has gone into appeal against abnormal hike in Cross Subsidy Surcharge in Tariff Order of 2015-16 at AppellateTribunal for Electricity. The final hearing in the matter is yet to be held.

FUEL COST ADJUSTMENT CHARGE :FCA Charge in the form of paise per unit (kwh) rounded off to the nearest integar is billed by the DISCOMs on quarterlybasis. The rates of FCA charges have been 32 paise per unit in the 2nd quarter and 4 paise per unit in 3rd and (-) 4 paise/unit in 4th quarter of 2015-16. FCA Charges of 4 paise/unit have been levied for the first and second quarters of thecurrent fiscal year 2016-17.


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POWER TARIFF 2015-16 FOR SEZ :The MPERC vide its Order dated 31st March, 2016, has extended tariff fixed for 2015-16 for Special Economic Zone(MPAKVN) to continue till further Orders. Tariff fixed for 2015-16 is as under :-

Category Fixed Charges per KV A Energy Charges per Unit11 KV Supply Rs. 160 Rs. 3.4533 KV Supply Rs. 199 Rs. 3.33

ELECTRICAL INSPECTION FEES :Notification dated 29th November, 2011 issued by the Energy Department prescribes inspection fees payable for variousclasses of installations. As per Notification dated 14th August, 2015, inspection and testing of electrical installationsonly above 33 Kilo Volt will be carried out.

ELECTRICITY SUPPLY CODE – 2013 :The new MP Electricity Supply Code, 2013 came into force w.e.f. 30th August 2013, whereby earlier MP ElectricitySupply Code, 2004 was replaced. First amendment to the Code was issued on 23rd October, 2015 in respect ofrequisition for new supply/additional supply of energy, reduction of contract demand, etc.

ELECTRICITY DUTY :Madhya Pradesh Vidyut Shulk Adhiniyam, 2012 came into effect from 26th April, 2012. As per this Act, Electricity Duty@ 9% is payable by the Textile Industry on purchase from DISCOMs, but Duty @ 15% is payable on Captive PowerConsumption. However, the Electricity Duty on captive power consumption has been reduced to 12% w.e.f. 1st April,2016. The State Government has levied Electricity Duty on open acess purchase also at the rates, as if the power ispurchased from DISCOMs.The State Government, Energy Department vide its Notification dated 4th March, 2014, exempted High Tension Consumers,who take new connections from Electricity Distribution Companies of the State within 5 years from 4th March, 2014, frompayment of Electricity Duty as under :-

Consumer Category Period of Exemption

33 KV 5 Years

132 KV 7 Years

220 KV 10 Years

According to one of the conditions of this Notification, the exemption will not be available for the units/consumerspresently connected with the Electricity Distribution Companies of the State.Vide another Notification dated 18th June, 2014, the State Government has exempted Solar, Wind and Bio-mass basedgenerating stations from payment of Electricity Duty for a period of ten years. Similarly small hydro based generatingstations have been exempted for a period of five years.As per Notification dated 8th January, 2016, any person gettingbenefit of exemption from payment of Electricity Duty under Notification dated 1st March, 2002 and Notification dated24th March 2007 shall continue to get such exemption till the completion of the period specified in said notifications.

ENERGY DEVELOPMENT CESS :Energy Development Cess was revised to 15 paise per unit w.e.f. 10th August, 2011, payable by every generatingcompany or a person owning or operating a captive generating plant on the total units of electricity sold or supplied toa distribution licensee or a consumer. However, as per Notification dated 11th January, 2013, the Cess is now notpayable on self-consumption by any person owning or operating a captive generating plant. The cess is being levied onopen access purchase of electricity as per clarification issued by Chief Engineer (Electrical Safety) & Chief ElectricalInspector on 18th June, 2013. The Association has represented against this clarification.


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M.P.INTIMATION OF ELECTRICITY ACCIDENTS (FORMS & SERVICES OFNOTICE) RULES, 2016 :The Energy Department of the State notified these Rules on 24th June, 2016 whereby if any accident occurs in connectionwith generation, transmission or use of electricity, the intimation of such accident is to be given to Chief ElectricalInspector within 48 hours of such accident.

STATE ADVISORY COMMITTEE OF MPERC :State Advisory Committee of MPERC has been reconstituted on 3rd October, 2014 and Dr. Gautam Kothari, President,Pithampur Audyogik Sangthan and Hon. Secretary, Electricity Consumers Society has been nominated as a Memberfor a period of three years.

RENEWABLE ENERGY PURCHASE OBLIGA TION :MPERC vide its Orders dated 19th November, 2010 amended on 8th May, 2015 and again amended on 28th September,2015, has levied Renewable Energy Purchase Obligation (REPO) on captive consumers and open access consumersw.e.f. financial year 2010-11. The quantum of energy prescribed for purchase from Solar and Non-Solar sources is asunder :-

Financial Year Quantum - %Solar Non-Solar Total

2010-11 - 0.80 0.80

2011-12 0.40 2.10 2.50

2012-13 0.60 3.40 4.002013-14 0.80 4.70 5.50

2014-15 1.00 6.00 7.00

2015-16 1.00 6.00 7.00

2016-17 1.25 6.50 7.75

2017-18 1.50 7.00 8.502018-19 1.75 7.50 9.25

On 13th May, 2015, the Hob’ble Supreme Court in the matter of Hindustan Zinc Limited v/s Rajasthan ElectricityRegulatory Commission (RERC) has upheld the Regulations made by RERC. Thus REPO applicability on Captive andOpen Access Power Consumers is held to be well within the ambit of Electricity Act, 2003.

CONSERVATION OF ENERGY – PAT :The Government of India has notified on 30th March, 2012 Perform, Achieve and Trade (PAT) Scheme. The designatedconsumers covered under the Scheme are required to achieve the specific energy reduction target by the financial year2014-15 and submit the verified report that they have complied with PAT requirements. The last date for which was 15th

June, 2015, which was extended to 14th August, 2015.

Energy cost in the textile industry accounts for 5-17% of the total production cost. The Mills, which have minimumannual energy consumption of 3000 tons of oil equivalent are required to comply with the provisions of the Scheme.Initially in PAT Cycle, 90 Designated Consumers have been identified from various States, for which targets have beennotified. Textile Sector has been categorized on the basis of four sub-sectors, i.e., Spinning, Processing, Compositeand Fibre. Energy consumption of these Designated Consumers is about 1.20 million tons of oil equivalent/year. Textileplants are further subdivided into two categories, i.e., captive power plant based plants and non-captive, i.e., gridconnected plants. By the end of first PAT Cycle, the energy savings of 0.066 million tons of equivalent is expected to beachieved by textile sector, which is 0.99% of total energy saving target under PAT Cycle-I (2012-13 to 2014-15).

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PERFORMANCE OF MEMBER MILLS2015-16

ANNEXURES

1. Installed Capacity : Annexure – I

2. Import of Raw Material : Annexure – II

3. Consumption of Raw Material : Annexure – III

4. Production of Spun Yarn, etc. : Annexure – IV

5. Production of Fabric : Annexure – V

6. Production of Knitted Garments : Annexure – VI

7. Processing of Fabric : Annexure – VII

8. Export of Spun Yarn, etc. : Annexure – VIII

9. Export of Fabric, Knitted Garments, Cotton /Cotton Waste, etc. : Annexure – IX

10. Turnover : Annexure – X

11. Contribution to Exchequer : Annexure – XI

12. Employees on Rolls : Annexure – XII

13. Power Purchase and Generation : Annexure – XIII


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ANNEXURE - IINSTALLED CAP ACITY AS ON 31ST MARCH, 2016.

Sr. Name of Unit

SpindlesRotors

Auto Knitting StenterOthers

No. Looms Looms Machines Machines1 Anant Spinning Mills 1,31,808 - - - - -

2 Bhaskar Industries Pvt.Ltd. 14,688 3,104 304 - 2 -

3 Century Denim 8,400 1,920 112 - 1 -

4 Century Yarn 24,960 - - - - -

5 Deepak Spinners Limited 38,736 - - - - -

6 Dhar Textile Mills Limited 3,840 1,296 - - - -7 Grasim Industries Limited - - - - - V.S.F.

(Staple Fibre Division) 1,62,425 Tons8 Hind Syntex Limited 36,768 - - - - -

9 Kamal Cotspin Pvt. Ltd. 31,200 - - - - -

10 Kohinoor Elastics Pvt.Ltd. - - 100 - - -

11 Jaideep India Pvt. Ltd. 25,000 - - - - -12 Madhumilan Industries Ltd. 23,000 - - - - -

13 Mahima Purespun 50,400 - - 4 - -

14 Maral Overseas Limited 78,864 - - 74 2 -15 Mohini Fibres Pvt. Ltd. - - - - - Technical

Textiles16 Nahar Spinning Mills Limited 1,27,776 - - - - -17 National Textile Corporation Ltd. 51.264 - - - - -

-Burhanpur Tapti Mills18 -New Bhopal Textile Mills 43,528 - - - - -

19 PBM Polytex Limited 21,984 - - - - -

20 Pratibha Syntex Limited 57,936 2,952 - 65 3 -

21 Prem Textiles (Intl.) Pvt.Ltd. - 576 76 - 2 -22 Ramesh Textiles India Pvt.Ltd. - - 24 - - -

23 Raymond Limited 36,396 - 113 - 7 -

24 Ritspin Synthetics Limited 25,752 - - - - -

25 Sagar Manufacturers Pvt.Ltd. 75,552 - - - - -

26 Satyam Spinners Pvt.Ltd. 15,336 - - - - -

27 SEL Manufacturing Co.Ltd. 3,26,400 3,480 - 250 - -28 Sheshadri Industries Ltd. 34,560 - - - - -

29 S. Kumars Limited 5,760 336 60 - 3 -

30 Spentex Industries Ltd. 63,696 - - - - -

31 SRF Limited 7,776 - 16 - - -

32 STI India Limited 71,040 - - 31 - -

33 Swastik Spintex Ltd. 5,760 600 - *- - -34 Vardhman Fabrics 1,15,008 5,640 820 - 5 -

35 Vardhman Yarns 3,05,376 - - - - -

36 Vikram Woollens 9,984 - - - - -

37 Vippy Spinpro Ltd. - 3,168 - - - -

38 Wearit Global Ltd. 34,032 - - - - -


67

ANNEXURE - IIIMPORT OF RAW MATERIAL

No. Name of Unit (who responded) Cotton MMF Wool

OthersKgs. Kgs. Kgs.

1 Anant Spinning Mills 5,99,269 5,35,640

2 Grasim Industries Ltd. (SFD) 1,29,178 Tons Pulp

3 Hind Syntex Limited 18,20,426

4 Maral Overseas Limited 80,751 62,664 1,70,434 Kgs. Yarn

5 Nahar Spinning Mills Ltd. 40,700

6 Pratibha Syntex Limited 3,00,978 4,24,892

7 Raymond Limited 15,33,494

8 Ritspin Synthetics Limited 2,10,893

9 Spentex Industries Limited 34,33,038

10 SRF Limited 5,545 Tons Caprolactum

11 Vardhman Fabrics 27,70,694

12 Vardhman Yarns 7,60,07,241 74,82,776 7,56,817 Kgs. Spendex


68

ANNEXURE - IIICONSUMPTION OF RAW MATERIAL

No. Name of Unit (who responded) Cotton MMF Wool

OthersKgs. Kgs. Kgs.

1 Anant Spinning Mills 3,62,71,737 16,59,031

2 Bhaskar Industries Pvt.Ltd. 80,74,411 15,50,34,721 Kgs. Yarn

3 Century Denim 87,70,884 27,40,668 Kgs. Yarn

4 Century Yarn 60,90,521

5 Deepak Spinners Limited 1,65,00,000

6 Dhar Textile Mills Limited 27,01,641

7 Grasim Industries Limited (SFD) 1,28,687 Tons Pulp

8 Hind Syntex Limited 7,98,888 80,80,320 1,44,490 Kgs. Yarn

9 Kamal Cotspin Pvt. Ltd. 34,31,380

10 Maral Overseas Limited 2,59,01,752 1,95,398 84,10,065 Kgs. Yarn

11 Nahar Spinning Mills Limited 2,74,67,997 7,76,381

12 National Textile Corporation Ltd. 32,89,000 24,98,000 -Burhanpur Tapti Mills

13 -New Bhopal Textile Mills 27,25,000 19,76,000

14 PBM Polytex Limited 51,12,936

15 Pratibha Syntex Limited 1,83,81,099 45,58,119 5,308 Kgs. Yarn

16 Prem Textiles (International) P.Ltd. 23,34,978 11,02,802 Kgs. Yarn

17 Raymond Limited 32,51,278 15,33,494 37,57,624 Kgs. Yarn

18 Ritspin Synthetics Limited 7,95,750 43,29,563 20,831 Kgs. Yarn

19 Sagar Manufacturers Pvt.Ltd. 2,07,65,703

20 Satyam Spinners Pvt.Ltd. 18,51,343

21 SEL Manufacturing Co.Ltd. 6,18,93,507

22 Sheshadri Industries Ltd. 53,79,665

23 S. Kumars Limited 10,46,777

24 Spentex Industries Ltd. 69,20,700 1,13,70,736

25 SRF Limited 25,926.70 Tons Caprolactum

26 STI India Limited 56,93,889 40,28,161

27 Swastik Spintex Ltd. 13,05,264

28 Vardhman Fabrics 3,22,52,430 43,97,290 2,90,948 Kgs. Spendex

29 Vardhman Yarns 6,95,57,386 70,60,648 60,85,505 Kgs. Spendex

30 Vippy Spinpro Ltd. 94,22,189

31 Wearit Global Ltd. 94,48,860


69

ANNEXURE - IVPRODUCTION OF SPUN YARN

No. Name of Unit (who responded) Cotton 100% Blended Blended Fibre etc.Kgs. Non-Cotton Cotton / MMF Wool / MMF

Kgs. Kgs. Kgs.

1 Anant Spinning Mills 2,91,22,148*

2 Bhaskar Industries Pvt.Ltd. 1,26,49,274

3 Century Denim 76,46,178

4 Century Yarn 44,28,266

5 Deepak Spinners Limited 1,59,00,000

6 Dhar Textile Mills Limited 21,15,752

7 Grasim Industries Limited (SFD) 1,27,656 TonsVSF82,150 Tons

Sod.Sulphate

8 Hind Syntex Limited 49,457 41,33,753 44,75,388

9 Kamal Cotspin Pvt. Ltd. 28,38,204

10 Maral Overseas Limited 2,09,97,168

11 Nahar Spinning Mills Limited 2,02,83,343

12 National Textile Corporation Ltd. 24,77,000 27,95,000-Burhanpur Tapti Mills

13 -New Bhopal Textile Mills 18,26,000 6,54,000 17,92,000

14 PBM Polytex Limited 34,38,077

15 Pratibha Syntex Limited 1,42,00,163 38,49,124

16 Prem Textiles (International) P.Ltd. 19,26,702

17 Ritspin Synthetics Limited 1,10,50,757

18 Sagar Manufacturers Pvt.Ltd. 1,47,75,043

19 Satyam Spinners Pvt.Ltd. 15,33,789

20 SEL Manufacturing Co.Ltd. 4,49,82,522

21 Sheshadri Industries Ltd. 39,64,378


23 Spentex Industries Ltd. 42,23,886 1,27,00,624

24 SRF Limited 2,51,77,000 26209 Tons Chips

25 STI India Limited 42,44,984 36,80,360 1,69,716

26 Swastik Spintex Ltd. 8,22,929

27 Vardhman Fabrics 3,22,00,650 75,86,582

28 Vardhman Yarns 5,80,43,431*

29 Vippy Spinpro Ltd. 85,81,916

30 Wearit Global Ltd. 67,75,232

*All fibres including cotton.


70

ANNEXURE - VPRODUCTION OF FABRIC

No. Name of Unit (who responded) Woven Knitted

Cotton Blended/ Blended Wool/Non-Cotton MMF

Mtrs. Mtrs. Mtrs. Kgs.

1 Bhaskar Industries Pvt. Ltd. 3,31,63,175

2 Century Denim 2,37,46,203

3 Maral Overseas Limited 37,26,138

4 Pratibha Syntex Limited 49,28,106

5 Prem Textiles (International) P.Ltd. 68,52,247

6 Raymond Limited 5,79,250 48,54,897

7 SEL Manufacturing Co.Ltd. 3,47,588


9 SRF Limited 16,669 Tons

10 STI India Limited 11,71,169

11 Vardhman Fabrics 18,43,94,174 2,32,22,911

ANNEXURE - VIPRODUCTION OF KNITTED GARMENTS

No. Name of Unit (who responded) No. of Pieces

1 Pratibha Syntex Limited 4,18,00,000

ANNEXURE - VIIPROCESSING OF FABRIC

No. Name of Unit (who responded) Quantity

1 Century Denim 1,62,72,571 Mtrs.

2 Maral Overseas Limited 48,06,993 Kgs.

3 Pratibha Syntex Limited 50,56,146 Kgs.

4 Raymond Limited 46,78,523 Kgs.

5 S. Kumars Limited 37,87,670 Kgs.

6 Vardhman Fabrics 2,21,77,494 Kgs.


71

ANNEXURE - VIIIEXPORT OF SPUN YARN, ETC.

Rs. in Lakh

No. Name of Unit (who responded) Cotton 100% Non Blended Blended Total- Cotton Cotton / MMF Wool / MMF

1 Anant Spinning Mills 34,383.89* 34,383.89

2 Bhaskar Industries Pvt.Ltd. 2,942.67 2,942.67

3 Century Yarn 518.01 518.01

4 Grasim Industries Limited (SFD) 42,083.00** 42,083.00

5 Kamal Cotspin Pvt. Ltd. 875.63 875.63

6 Maral Overseas Limited 20,448.46 20,448.46

7 Nahar Spinning Mills Limited 20,591.18 20,591.18

8 PBM Polytex Limited 4,161.48 4,161.48

9 Pratibha Syntex Limited 4,983.57 809.89 5,793.46

10 Sagar Manufacturers Pvt.Ltd. 20,170.22 20,170.22

11 SEL Manufacturing Co.Ltd. 47,360.81 47,360.81

12 Spentex Industries Ltd. 1,602.13 11,344.11 12,946.24

13 SRF Limited 471.82 471.82

14 STI India Limited 63.93 63.93

15 Vardhman Fabrics 4,733.98 1,569.20 6,303.18

16 Vardhman Yarns 57,288.02* 57,288.02

17 Vippy Spinpro Ltd. 1,624.47 1,624.47

18 Wearit Global Ltd. 9,194.41 9,194.41

*Includes all types of yarn.

**Viscose Staple Fibre


72

ANNEXURE - IXA - EXPORT OF WOVEN FABRIC

Rs. in Lakh

No. Name of Unit (who responded) Cotton Woollen/MMF Cotton/MMF TotalNon-Cotton

1 Bhaskar Industries Pvt.Ltd. 7,155.85 7,155.85

2 Century Denim 2,361.49 2,361.49

3 Raymond Limited 10,926.16 10,926.16

4 S. Kumars Limited 1,146.78 1,146.78

5 Vardhman Fabrics 2,151.26 7,926.62 10,077.88

ANNEXURE - IXB – EXPORT OF KNITTED FABRIC

(GREY / PROCESSED)

No. Name of Unit (who responded) Value Rs. in Lakh

1 Maral Overseas Limited 6,485.90

2 STI India Limited 154.67

ANNEXURE - IXC - EXPORT OF KNITTED GARMENTS/MADE-UPS

No. Name of Unit (who responded) Nos. in Lakh Value Rs. in Lakh

1 Pratibha Syntex Limited 399.26 53,247.53

2 Prem Textiles (International) Pvt. Ltd. 13,346.00

ANNEXURE - IXD - EXPORT OF COTTON/COTTON WASTE


1 Kamal Cotspin Pvt.Ltd. 13.84

2 Maral Overseas Limited 193.99


73

ANNEXURE - XTURNOVER


1 Anant Spinning Mills 59,809.25

2 Bhaskar Industries Pvt.Ltd. 95,000.00

3 Century Denim 23,747.80

4 Century Yarn 9,494.32

5 Deepak Spinners Limited 18,819.90

6 Dhar Textile Mills Limited 2,496.84

7 Grasim Industries Limited (SFD) 1,92,430.00

8 Hind Syntex Limited 4,042.91

9 Kamal Cotspin Pvt. Ltd. 5,705.30

10 Maral Overseas Limited 53,814.08

11 Nahar Spinning Mills Limited 37,760.02

12 National Textile Corporation Ltd.

-Burhanpur Tapti Mills 8,831.16

13 -New Bhopal Textile Mills 7,621.67

14 PBM Polytex Limited 7,510.67

15 Pratibha Syntex Limited 82,849.53

16 Prem Textiles (International) Pvt.Ltd. 14,581.00

17 Raymond Limited 60,933.44

18 Ritspin Synthetics Limited 8,239.12

19 Sagar Manufacturers Pvt.Ltd. 31,043.79

20 Satyam Spinners Pvt.Ltd. 16,205.00

21 SEL Manufacturing Co.Ltd. 83,679.99

22 Sheshadri Industries Ltd. 6,983.73

23 S. Kumars Limited 8,395.15

24 Spentex Industries Ltd. 28,376.23

25 SRF Limited 53,819.09

26 STI India Limited 9,547.70

27 Swastik Spintex Ltd. 897.16

28 Vardhman Fabrics 1,44,951.84

29 Vardhman Yarns 1,27,598.00

30 Vippy Spinpro Ltd. 8,775.98

31 Wearit Global Ltd. 12,668.21


74

ANNEXURE - XICONTRIBUTION TO EXCHEQUER

Rs. in Lakh

No. Name of Unit (who responded) Excise/Custom/ CST/VAT/ET Other Taxes

Service T ax I.Tax/TDS, etc.

1 Anant Spinning Mills 536.16 292.85

2 Bhaskar Industries Pvt.Ltd. 475.00 188.29 555.00

3 Century Denim 159.32 96.32 83.38

4 Century Yarn 49.99 124.29 31.35

5 Dhar Textile Mills Limited 1.07 35.80 6.18

6 Grasim Industries Limited (SFD) 16,559.00 5,294.00 11,792.00

7 Hind Syntex Limited 517.66 8.11 10.90

8 Kamal Cotspin Pvt. Ltd. 0.86 92.21 60.18

9 Maral Overseas Limited 267.04 390.54 206.30


- Burhanpur Tapti Mills 0.43 165.40 2.76

11 -New Bhopal Textile Mills 0.53 141.88 24.58

12 PBM Polytex Limited 23.90 14.73 22.83

13 Pratibha Syntex Limited 180.28 1,242.55 1,061.55

14 Prem Textiles (International) P.Ltd. 18.87 38.49 222.02

15 Raymond Limited 150.27 338.09 213.83

16 Ritspin Synthetics Limited 365.72 108.05 79.61

17 Sagar Manufacturers Pvt.Ltd. 16.48 278.88 252.11

18 Satyam Spinners Pvt.Ltd. 242.78 21.17

19 SEL Manufacturing Co.Ltd. 96.12 671.43 168.37

20 Sheshadri Industries Ltd. 3.60 90.71 2.68

21 S. Kumars Limited 8.28 31.36

22 Spentex Industries Ltd. 483.00 359.20 33.53

23 SRF Limited 3,940.68 479.24 265.42

24 STI India Limited 17.53 24.09 75.73

25 Swastik Spintex Ltd. 0.65 30.02 3.01

26 Vardhman Fabrics 457.22 451.72 333.64

27 Vardhman Yarns 2,050.46 1,049.20 237.70

28 Vippy Spinpro Ltd. 6.00 142.20 142.28

29 Wearit Global Ltd. 302.04 362.61


75

ANNEXURE - XIIEMPLOYEES ON ROLLS

No. Name of Unit (who responded) Staff Workmen Total

Permanent Temporary Trainee Badli

1 Anant Spinning Mills 173 2025 2198

2 Bhaskar Industries Pvt.Ltd. 423 2272 199 2894

3 Century Denim 114 502 34 242 892

4 Century Yarn 61 289 14 90 454

5 Deepak Spinners Limited 120 300 75 300 795

6 Dhar Textile Mills Limited 33 100 58 191

7 Grasim Industries Limited (SFD) 1732 26 1758

8 Hind Syntex Limited 113 1140 162 37 1452

9 Kamal Cotspin Pvt. Ltd. 265 265

10 Maral Overseas Limited 329 992 730 809 2860

11 Nahar Spinning Mills Limited 253 1321 1574


- Burhanpur Tapti Mills 64 71 824 959

13 - New Bhopal Textile Mills 66 15 850 68 999

14 PBM Polytex Limited 113 351 1 465

15 Pratibha Syntex Limited 1087 7013 102 8202

16 Prem Textiles (International) Pvt.Ltd. 125 529 132 786

17 Raymond Limited 485 2484 157 3126

18 Ritspin Synthetics Limited 86 307 146 183 722

19 Sagar Manufacturers Pvt.Ltd. 160 199 159 387 905

20 Satyam Spinners Pvt.Ltd. 20 10 185 215

21 SEL Manufacturing Co.Ltd. 284 1786 580 2650

22 Sheshadri Industries Ltd. 65 184 148 14 65 476

23 S. Kumars Limited 180 423 87 75 765

24 Spentex Industries Ltd. 125 1059 536 388 2108

25 SRF Limited 93 419 7 519

26 STI India Limited 134 817 101 1052

27 Swastik Spintex Ltd. 32 25 14 6 77

28 Vardhman Fabrics 677 3112 788 4577

29 Vardhman Yarns 385 2524 2909

30 Vippy Spinpro Ltd. 62 57 15 134

31 Wearit Global Ltd. 54 511 55 56 676


76

ANNEXURE - IXPOWER PURCHASE & GENERATION

No. Name of Unit (who responded) Purchased Own GenerationConnected Units Capacity UnitsLoad KVA Consumed KVA Generated

1 Anant Spinning Mills 23,804.21 10,21,10,237 8MW+250KVA 248

2 Bhaskar Industries Pvt.Ltd. 8,400 6,25,69,411 3500 33,395

3 Century Denim 5,400 3,89,16,200 8091 1,62,700

4 Century Yarn 3,000 2,11,37,820 4,582.5 -

5 Deepak Spinners Limited 2,500 1,72,68,000 3,000 1,79,80,070

6 Dhar Textile Mills Limited 750 45,59,200

7 Hind Syntex Limited 4,225 2,93,83,645

8 Kamal Cotspin Pvt. Ltd. 2,050 1,38,83,300

9 Maral Overseas Limited 2,000 1,91,67,400 16.65MW 5,92,75,921

10 Nahar Spinning Mills Limited 25,599 10,08,96,352 19,100 30,647


- Burhanpur Tapti Mills 3,500 2,70,88,000

12 - New Bhopal Textile Mills 3,100 13,43,31,000

13 PBM Polytex Limited 2,200 1,35,83,856 1,250 1,30,631

14 Pratibha Syntex Limited 10,000 8,20,02,000

15 Prem Textiles (International) Pvt.Ltd. 1,345 72,71,331 722.5 23,886

16 Raymond Limited 20,312 23,42,614 11.50MW 5,16,41,000

17 Ritspin Synthetics Limited 3,200 2,22,47,100

18 Sagar Manufacturers Pvt.Ltd. 6,800 5,11,85,870

19 Satyam Spinners Pvt.Ltd. 750 56,99,560 380 4,200

20 SEL Manufacturing Co.Ltd. 40,000 17,92,17,000

21 Sheshadri Industries Ltd. 3,000 19,96,96,080

22 S. Kumars Limited 1,650 84,75,240 880 45,897

23 Spentex Industries Ltd. 7,400 5,26,08,000

24 SRF Limited 12,000 8,20,43,925 6,000 7,34,630

25 STI India Limited 10,050 3,38,97,780 735 1,042

26 Swastik Spintex Ltd. 500 21,76,339

27 Vardhman Fabrics 11,000 9,09,14,800 40,000 14,95,62,453

28 Vardhman Yarns 1,37,44,000 38,750 22,94,17,822

29 Vippy Spinpro Ltd. 1,550 1,01,80,140 1,395 9,61,478

30 Wearit Global Ltd. 3,780 2,71,16,200

the madhya pradesh textile mills association on 1 st june, 1966 af ter being renamed as the madhya...

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