Budget 2016: Sops to yield Rs 7,500 crore more through garment exports

NEW DELHI: Tax sops such as slashing of basic customs duty on specified fibres and yarns, continuation of duty free import of trimmings and embellishments announced in the busget will generate additional garment exports worth Rs 7,500 crore in 2016-17, an industry body said today.

"Total additional exports of Rs 7,500 crore in 2016-17 are envisaged by the incentives announced in this Budget," Apparel Export Promotion Council Chairman Ashok G Rajani said.

He said the addition of 1 per cent Free on Board (FOB) value of exports in custom duty for specified fabrics would enable garment exporters to undertake production where they were not competitive.

"In the year 2016-17, fabrics worth around Rs 1,000 crore (1 per cent of Rs 1 lakh crore) would be eligible for imports and custom duty of Rs 110 crore would be saved by garment exporters.

"This will give avenues for new product development. It would provide additional exports of Rs 2,500 crore in a complete year," Rajani said.

Besides, the continuation of duty free import of trimmings and embellishments to the extent of 5 per cent of FOB would give additional garment export of Rs 5,000 crore in 2016-17, he said.