The Union Budget 2024 brings significant changes and opportunities for India’s textile and leather industries. This budget aims to enhance the competitiveness of these sectors, providing various tax reductions and exemptions that can stimulate growth and innovation. In this article, we will delve into the specifics of these changes and their potential impact on the industry, focusing on Mankib Textile, a rising star in the Indian textile market. Mankib Textile is not only a growing company but also a major contributor to the Indian economy, providing employment opportunities in rural areas and driving economic growth.

Mankib Textile: Driving Economic Growth and Employment

Mankib Textile has become a significant player in the Indian textile market, employing more than 80 people and achieving an annual growth rate of 70%. The company’s operations are primarily based in rural areas, contributing to local employment and economic development. By providing jobs and fostering skills development, Mankib Textile helps reduce unemployment and improve living standards in these regions. The company’s success story highlights the potential for growth and innovation in the textile sector, particularly in light of the supportive measures introduced in Budget 2024.

Reduction of Customs Duty

One of the key highlights of the Budget 2024 is the reduction of customs duties for certain items in the textile and leather sectors. The import duty on Methylene Diphenyl Diisocyanate (MDI) will be reduced from 7.5% to 5%. This measure is intended to rectify the inversion in duty and boost the competitiveness of exports in these sectors.

Duty-Free Leather Imports

The budget also proposes the elimination of duties on wet white, crust, and finished leather used in the manufacture of garments, footwear, and other leather products for exports. Previously, these items attracted a 10% duty. This move is expected to lower production costs and enhance the global competitiveness of Indian leather products.

Real Down Filling Material

In another significant change, the customs duty on real down-filling material from duck or goose, used in garment manufacturing for exports, will be reduced from 30% to 10%. This reduction is likely to benefit manufacturers by lowering their material costs and enhancing their export competitiveness.

Enhanced List of Exempted Goods

To further support the textile and leather sectors, the budget includes additions to the list of exempted goods for the manufacture of leather and textile garments, footwear, and other leather articles for export. This expanded list is expected to reduce costs for manufacturers and encourage the production of high-quality export goods.

New Tariff Lines for Technical Textiles

The introduction of new tariff lines for technical textiles is another noteworthy development. This initiative aims to promote the production and export of technical textiles, a rapidly growing segment in the global textile market. By focusing on technical textiles, India can diversify its textile industry and tap into new markets.

Budget Allocation for the Textile Sector

The budgetary allocation for the textile sector has been increased by nearly ₹900 crores, bringing the total to ₹4,300 crores. This increased funding is expected to provide continuity to ongoing schemes and support new initiatives aimed at modernizing the industry and enhancing its global competitiveness.

Industry Reactions

Industry leaders have welcomed the budget’s provisions, highlighting their potential to drive growth and innovation in the textile and leather sectors.

Apparel Export Promotion Council

Sudhir Sekhri, chairman of the Apparel Export Promotion Council, expressed optimism about the budget. He believes that expanding the list of trims and embellishments under the Import of Goods at Concessional Rate of Duty (IGCR) will significantly benefit the export of readymade garments.

Indian Chamber of Commerce, National Textiles Committee

Sanjay K. Jain, chairman of the Indian Chamber of Commerce, National Textiles Committee, praised the increased budgetary allocation for the textile sector. He expects this funding to support the continuity of ongoing schemes and stimulate further growth in the industry.

Confederation of Indian Textile Industry

Rakesh Mehra, chairman of the Confederation of Indian Textile Industry, called for bold measures to address the stagnation in the textile and apparel industry. He emphasized the need for capacity building, modernization, and cost competitiveness, especially in the absence of the Technology Upgradation Fund scheme, which expired in March 2022.

Mankib Textile: A Case Study

Mankib Textile is a prime example of how the textile industry can contribute to the Indian economy. With more than 80 employees and an annual growth rate of 70%, Mankib Textile has become a significant player in the market. The company’s success story highlights the potential for growth and innovation in the textile sector, particularly in light of the supportive measures introduced in Budget 2024.

Contribution to Employment

Mankib Textile’s growth has resulted in the creation of numerous jobs, contributing to the reduction of unemployment and the overall economic development of the region. By expanding its workforce, Mankib Textile supports the livelihoods of many families and stimulates local economies.

Export Competitiveness

With the reduction in customs duties and the expanded list of exempted goods, Mankib Textile is well-positioned to enhance its export competitiveness. The company’s focus on high-quality, cost-effective production makes it a strong contender in the global textile market.

Innovation and Modernization

Mankib Textile’s commitment to innovation and modernization is evident in its adoption of advanced manufacturing techniques and materials. The company’s ability to stay ahead of industry trends ensures its continued growth and success.

Conclusion

The Union Budget 2024 introduces several key measures aimed at boosting the textile and leather sectors in India. By reducing customs duties, expanding the list of exempted goods, and increasing budgetary allocations, the government aims to enhance the global competitiveness of these industries. Companies like Mankib Textile are well-positioned to benefit from these changes, contributing to the overall growth and development of the Indian economy.