COMMITTEE OF ADMINISTRATION

COMMITTEE OF ADMINISTRATION

The 6^th Annual General Meeting of the PDEXCIL was held on the 29^th of September, 2001, at the Ambassador Hotel, Shiva Hall, 1^st Floor, V.N. Road, Churchgate, Mumbai-400 020.

The composition of the Committee of Administration of the PDEXCIL has thereafter been as follows :-

1.	Shri M.Y. MominChairman, PDEXCIL	13.	Shri S. Raghunathan
2.	Shri Md. Ikram AnsariVice-Chairman [Central Region]PDEXCIL	14.	Shri Jameel Ah. Abdul Ghaffar Rahman
3.	Shri M. Senthil KumarVice-Chairman [Southern Region]PDEXCIL	15.	Shri A. Rajasekar(from 29.09.2001 onwards)
4.	Shri Ansari Khurshid Ahmed	16.	Shri Dharmanna M. Sadul
5.	Shri Mohd. Vasi Haji Sharfuddin Ansari	17.	Shri Mohd. Yusuf Abdulla Shaikh
6.	Shri Anwar Ah. Ab. Aziz	18.	Shri B. Sivagnanam(from 29.09. 2001 onwards)
7.	Shri T.P. Dasappachetty(from 29.09.2001 onwards)	19.	Shri Dhanpal A. Tare
8.	Shri M.S. Jalaludeen	20.	Shri P.R. Vijayaraghavan.
9.	Shri C.P. Kumaresan(from 29.09.2001 onwards)	21.	Mrs. Kiran Dhingra, I.A.S.,Joint Secretary, Ministry of Textiles, Govt. of India.
10.	Shri Vijay Kumar G. Manek	22.	Shri B.C. Khatua, I.A.S./Shri Sudhir Bhargava, I.A.S./Shri Subodh Kumar, I.A.S.Textile Commissioner, Govt. of India.
11.	Shri Ka. Marappan	23.	Managing Director, NABARD
12.	Shri M.S. Mathivanan	24.	Managing Director, SIDBI

3. During the year under review, the Committee of Administration (Committee) met 5 times on 15/06/2001, 24/07/2001, 29/09/2001, 21/12/2001 & 27/03/2002 under the chairmanship of Shri M.Y. Momin to consider and decide on matters concerning the development & export promotion of the fabrics manufactured in the decentralised powerloom sector and the made-ups there-out-of. The Committee was assisted in its task by the following statutory Panels/Committee :-

a) Development & Extension Panel

Export Promotion Panel

Finance Panel

Staff Committee

4. Shri M.Y. Momin, Chairman, in his address on the occasion of the 6^th Annual General Meeting of the PDEXCIL held on 29.09.2001, highlighted the need for the modernization and upgradation of the technology of the small scale powerloom sector which produces more than 60% of the fabrics in the country, generates considerable exports thereof and caters to the needs of the local garment industry for the domestic market and for the exports thereof from the country. He urged both the Central and State Governments to concentrate on giving facilities to the powerloom sector to modernize in light of the recommendations passed in the conference of states and union territories on 10/4/2001. The Chairman further stressed on a stricter Anti-Dumping cell in the Ministry to monitor and stop the unabated imports of under-invoiced textile products from abroad which was killing the domestic powerloom textile industry. He further requested the MOT, GOI to make the procedure for application of PEE quota powerloom friendly and less cumbersome and also consider increasing the share of PEE quota from the extant level of 15% to atleast 25% of the overall textile export kitty, if not commensurate with the share of the production of powerloom fabrics in the total production of fabrics in the country. The Chairman further stressed on other major areas of concern of the decentralised powerloom industry such as increased recourse by the developed countries to protectionist non-tariff barriers, etc., major shift in sources of import due to formation of regional trading blocs and preferential trade treaties by U.S.A. and E.E.C. covering outward processing trade (OPT) etc. apart from slew of other domestic and external factors specifically pertaining to the healthy and harmonious development of the decentralised powerloom sector in India. He further thanked all the Hon’ble Ministers, Officers in the Ministry, all other organisations associated with the PDEXCIL, the press and media, the Committee members of the PDEXCIL and the Officers and Staff of the Council for supporting the PDEXCIL in all its activities.

5. The general body [A.G.M.] of the Council had also unanimously passed resolutions adopting the annual report of the Committee, the Council’s audited balance-sheet and income & expenditure account for the financial year that ended on the 31^st of March, 2001, appointing the auditors of the Council and noting the election of the following members to the Committee :-

EASTERN REGION (Elected uncontested)

Shri Vijaykumar G. Manek.
SOUTHERN REGION:

Shri A. Rajasekar, Chatrapatti, Tamil Nadu.
Shri B. Sivagnanam, Erode, Tamil Nadu.
Shri C.P. Kumaresan, Tirupur, Tamil Nadu.
Shri Ka. Marappan, Muthur, Tamil Nadu.
Shri P.R. Vijayaraghavan, Rajapalayam, Tamil Nadu.
Shri T.P. Dasappa Chetty, Anthiyur, Tamil Nadu

6. The Committee during the year under review took up and made several recommendations to the Govt. of India towards the modernisation and upgradation of the technology of the decentralised powerloom sector and the development and promotion of the exports of the products thereof. Some of the important suggestions made by the Council to the Government are as follows :-

Modifications in the EXIM Policy

Suggestions were made for modification in the various provisions of the EXIM Policy as well as in the Handbook of Procedures. Some of the issues which have been raised are ;

* Continuation of DEPB scheme.

* To do away with the requirement of customs verification under DEPB and DFRC schemes.

* Grant of drawback under the DEPB scheme.

* Inclusion of a chapter on Small Scale Industry in the EXIM Policy.

* Amendment of para 12.7(a) with regard to triple weightage given to supplies of Small Scale industry for the purpose of recognition of the Export Houses.

* Necessary provision for refund of sales tax under the DEPB and the Advance Licence schemes.

b) Budget Proposals

Suggestions were made for inclusion in the budget proposals for the financial year 2002-2003. The major suggestions contained in the memorandum submitted in this regard are ;

Abolition of excise duty upto processing fabric stage. Alternatively option to be given to pay excise duty on cotton grey fabrics, if CENVAT is introduced.

Excise duty on textile machinery should be exempted in respect of the machinery for which CVD has been abolished.

Income tax on export profits under 80 HHC of the Income Tax act should be introduced in a phased manner for a period of eight years instead of five years.

Extension of subsidy to the extent of 25% to implement the textile package announced in the last budget.

Exemption from service tax in respect of services provided to the exporters.

The budget proposals announced on 28^th of February, 2002, contained provisions, applicable to the textile industry to meet global competition. Some of the major provisions were ;

Excise duty of 12% has been imposed on grey fabrics on an optional basis.

Excise duty on processed fabrics and made-ups has been reduced from 16% to 12%.

Compounded levy scheme applicable to independent process houses has been abolished.

Excise duty on automatic shuttle looms has been reduced to nil.

Customs duty on textile machinery applicable in respect of shuttleless looms as well as on bleaching and dyeing machinery has been continued at 5%.

Additional depreciation at 15% on new plant machinery has been announced in respect of a new unit and for expanding the existing unit by not less than 25%.

In respect of small scale units, the composite loans has been increased to five lakhs. The exemption limit for providing collateral security has been increased to Rs. 5 lakhs.

Cloth processed in a hand-processing unit is subjected to an excise duty of 12% except in respect of three processes stipulated.

c) Credit Linked Capital Subsidy Scheme [CLCSS] :

Units in the small scale sector can now avail of the facility provided under the Credit Linked Capital Subsidy Scheme [CLCSS] or under the TUF scheme, for the purpose of modernisation. It has been mentioned that registration as a SSI unit shall not be insisted upon for availing the facility under the CLCSS. As the guidelines issued by the office of the Textile Commissioner, in connection with availing the facility under CLCSS, were not clear and some of the provisions would not provide the desired benefit, a detailed communication was addressed seeking necessary clarification on the same.

As Credit Linked Capital Subsidy Scheme is applicable only for small scale industries, it was represented that since this scheme also could be availed off as option to TUF scheme, powerloom textile units which are not registered as SSI be also permitted to avail this facility. Subsequently, when the guidelines were issued for operation of the scheme, it was clarified that registration as SSI is not a pre-requisite for availing facility under the scheme.

d) Export Targets :

A detailed memorandum was submitted to the Govt. indicating the factors responsible for decline in exports and non fulfillment of the export targets. The memorandum also contained the measures required to achieve the target. Some of the suggestions indicated are ;

To develop closer trade relations with the ASEAN countries.

Extension of credit to certain countries by EXIM bank to enable them to purchase materials from India.

Removal of cap value from the drawback schedule.

Grant of drawback under brand rate in respect of exports under DEPB scheme.

Continuation of DEPB scheme.

Introduction of uniform single rate of value added tax in all the states.

Lowering of power tariffs.

Suitable schemes for small scale sector for modernisation.

Early integration of quota in respect of items having specific levels with European Union and USA to encourage exports.

e) Trade Policy Review Meeting :

In connection with the Trade Policy Review Mechanism meeting of the WTO between the Ministry of Commerce / Ministry of Textiles with various countries, communications were addressed indicating the issues which are coming in the way of developing trade in respect of following countries ;

i) USA

ii) Mexico

iii) East Caribbean States

iv) Gabon

v) Cameroon

vi) Czech Rep.

vii) Pakistan

viii) Mauritius

ix) Malaysia

x) Uganda

xi) Haiti

xii) Slovenia

f) Free Trade Agreement :

In connection with entering into Free Trade Agreement with the following countries, detailed comments were sent to the Ministry of Textiles indicating the tariff lines for seeking concession under the proposed agreement;

i) Colombia

ii) Brazil

g) Visit of the Hon'ble Prime Minister :

In connection with the visit of the Hon'ble Prime Minister of India to the following countries, necessary information were sent in respect of the following countries for taking up the issues at the bilateral talks.

i) Australia

ii) Singapore

iii) USA

h) Joint Commission :

In connection with the following meetings of the Joint Commission, details have been sent for taking up the issues suitably at the meeting.

i) EC-India Joint Commission

ii) Indo-Tajikistan Joint Commission

iii) Indo-Armenia Inter Governmental Commission

iv) India-Israel Economic Commission

v) Indo-China Joint Group on Economic Relations and Trade

i) Strategy for developing exports :

In connection with the formulation of appropriate strategy for developing exports to the following countries, suggestions were sent to the Ministry of Textiles.

i) NAFTA countries

ii) Latin American countries

iii) Denmark

iv) Argentina, Uruguay & Paraguay

v) Hongkong

vi) Chile

j) Formulation of state policy for development of exports :

In respect of following states, necessary materials were furnished for formulating suitable export policy for development of exports from the concerned state.

i) Maharashtra (ii) Uttar Pradesh

k) Quota Policy and Procedures :

A communication was addressed suggesting changes in the quota allocation procedures and other related matters with regard to PEE as well as other systems.

Representation was made not to transfer 5% TUFS related quota out of the PEE quota to the RGE system. As the 5% TUFS related quota was subsequently transferred to the RGE system, representation was made again to retransfer the same to the PEE quota in order to fulfil the objective of the PEE quota system to bring the powerloom manufacturers into the main stream of exports.

A communication was addressed requesting to include representatives of the PDEXCIL on the Enforcement Committee set up for the purpose of deciding on the various practices with regard to quota procedures followed by the exporters.

A communication was also addressed with regard to inclusion of a representative on the Quota Co-ordination Committee, set up for the purpose of reviewing the procedures.

l) Drawback :

Representations were made to various customs houses with regard to delay in settling of pending claims of drawback of various exporters.

Representation was made to the Dept. of Revenue to consider giving retrospective effect from June onwards with regard to increase in the drawback rate for made-ups as well as the amount of cap value effected in October, 2001.

Representation was made to remove the cap value in respect of textile items as it discouraged exporters of value added items.

Representation with regard to fixation of rate of drawback against exports of cotton grey fabrics strips.

Representation was made with regard to grant of drawback under the DEPB scheme.

Circular issued to the members of the Council requesting to furnish cost data for the purpose of fixation of All Industry Rates of drawback.

A communication was addressed to the Ministry of Textiles indicating the changes desired in the description of the textile items included in the drawback schedule for the purpose of modifying suitably the drawback schedule.

m) High Level Grievance Committee :

The issues relating to various problems as well as difficulties caused to the exporters were brought to the notice of the High Level Committee on Redressal of Grievances set up by the Ministry of Commerce for getting necessary relief to the exporters.

n) Other Issues :

Detailed communications were addressed to the Ministry of Textiles / Ministry of Commerce and other organisation, on the following issues ;

Consequent to the joining of the WTO by China w.e.f. 11^th of December, 2001, suggestions were sent with regard to providing of safeguard measures against import from China.

Implications of the preferential package offered to Pakistan by the European Union.

Effect of tragic event of September 11 in New York on exports of textiles.

The cumbersome procedures followed by various countries for issuance of visa to facilitate visit to those countries by the exporters have come in the way of developing exports and therefore the WTO needs to be requested to formulate an uniform procedure for the purpose.

Implications of the GSP benefits offered by the United States in so far as exports of powerloom textile are concerned.

Concession on textile items which required to be offered by SAPTA countries for exports of textiles from India.

Representation was made to abolish the provision relating to fulfillment of export obligation under the EPCG scheme.

Representation was made relating admissibility of DEPB benefit in respect of yarn dyed materials for the intervening period of 25^th of August, 1999 to January, 2000, in view of the fact that the concerned notification no. 54/00-Cus dated 25^th of August, 1999, was withdrawn by the Dept. of Revenue.

Representation was made to the state authorities in Maharashtra State with regard to difficulties of the exporters in connection with increase in power tariffs, imposition of sales tax on raw materials etc.

Communications were addressed to the Ministry of Textiles giving relevant details relating to textiles for formulating suitable replies to the Parliament Questions.

7. DEVELOPMENTAL ISSUES :

(a) The Council has been organising meetings of the Powerloom Centres Development Committees at most of the important identified clusters in the country, interalia after co-ordination with the concerned Textile Research Association and bankers for providing assistance in the modernisation and technology upgradation of the decentralised small scale powerlooms at these centres, amongst other things to the TUFS.

(b) The Council is organising meetings between the bankers, TRA's and the powerloom entrepreneurs to further the development programme of modernisation of powerloom units at the various powerloom centres.

(c) The Council has been consistently making representations to the Ministry of Textiles for relaxation of certain terms and conditions in the TUFS and various other schemes, especially for the powerloom sector.

(d) A programme of in-situ modernization of attachments on the looms alongwith the demonstration for the benefit of the powerloom weavers had been initiated and financed by the PDEXCIL at the SITRA powerloom service centre, Somanur, Tamil Nadu.

(e) A programme of in-situ modernization of attachments on the looms alongwith the demonstration for the benefit of the powerloom weavers, financed by the PDEXCIL was organised with the technical assistance of SITRA at the SRRS Government Polytechnic, Sircilla, Andhra Pradesh.

(f) In pursuance of the survey report on textile units in Solapur submitted by the BTRA with regard to process parameters, an inaugural function was arranged in Solapur as a part of the second stage of the programme. This was followed by demonstration of various standardised process parameters to impress upon the manufacturers about the need for adoption of the same. This demonstration is being done in a selected unit for a period of three to six months.

I] Development programmes :

a) Seminars : Seminars aimed at giving information about various aspects such as customs/central excise/ import-export policies/procedures/WTO/Technical Textiles/quality aspects in production of powerloom textiles/marketing of powerloom products/Technology Upgradation Fund Scheme etc. were organised at the following places;

1.

Meerut [U.P.]

2.

Hyderabad [A.P.]

3.

Sircilla [A.P.]

4.

Malegaon [M.S.]

5.

Komarapalayam [T.N.]

6.

Maunathbhanjan [U.P.]

7.

Varanasi [U.P.]

8.

Burhanpur [M.P.]

9.

Komarapalayam [T.N.]

10.

Erode [T.N.]

b) Training programmes :

+ One day training programmes on "Fabric quality checkers" were organised in association with Textiles Committee at the following places;

- Somanur, Tamil Nadu.

- Palladam, Tamil Nadu.

- Malegaon, Maharashtra.

A 3 day training programme in Hindi on export documentation and management was organised at Solapur through the Indian Institute of Foreign Trade (IIFT) to familiarize the exporters about export documentation, procedures and various schemes for exporters and marketing.

A one day training programme on Fabric costing & maintenance cost was organised by the PDEXCIL in association with the BTRA at Solapur.

c) The Council participated in the meetings of the Ministry of Textiles, Govt. of India & Ministry of Commerce, Govt. of India for making suggestions on various developmental & export promotion matters in regard to powerloom textiles.

d) The PDEXCIL actively participated in meetings organised by various organisations and made suggestions on various developmental and export promotion matters in regard to powerloom textiles.

e) The PDEXCIL presented papers in seminars organised by different organisations.

f) The PDEXCIL participated in various workshops organised by Textile Committee during the financial year 2001-2002.

g) The Council participated and assisted in the facilitation camps organised by the office of the Textile Commissioner at various powerloom centres to enthuse powerloom units to go in for modernisation of their units.

h) The PDEXCIL organised and actively participated in the visit of the Parliamentary Sub-committee on textiles at Mumbai and Bhiwandi.

i) The PDEXCIL organised the visit of a delegation comprising of powerloom weavers sent by the Government of Andhra Pradesh [A.P.] to Nagari [A.P.], Salem, Komarapalayam, Elampillai, Erode, Muthur and Palladam in Tamil Nadu.

j) Sponsorships :

The PDEXCIL partly sponsored a fashion show viz. "Design Collection 2001 – Fashionova 2001" organised by NIFT at Bangalore.

The PDEXCIL partly sponsored a workshop organised by Textiles Committee on "Quality and Compliances – Route to Global Competitiveness for Indian textiles and clothing industry" at Coimbatore

II] Export Promotion Programmes :

a) The Council participated in the following international textile trade fairs;

(a)

Techtextil- Frankfurt, Germany

-

24-26.04.2001

(b)

IFFE, New York, USA.

-

02-04.04.2001

(c)

Fenit, Sao Paulo, Brazil

-

02-05.07.2001

(d)

Mexico Textil 2001, Mexico

-

05-07.09.2001

(e)

Techtextil South America, Sao Paulo, Brazil

-

06-08-11-2001

(f)

Heimtextil 2002, Frankfurt, Germany

-

09-12-01-2002

(g)

Texstyles India’2002

-

10-13.02.2002

(h)

Asia Global Sourcing Exhibition/Conference, Jakarta, Indonesia

-

14-16.03.2002

b) Sales-cum-Study Teams [SST] of powerloom textile exporters, supported by the Council official, were sponsored by the Council to the following promising overseas markets;

(a)

SST to Saudi Arabia, Dubai & Kuwait

-

18.05.2001 to 01.06.2001

(b)

SST to Chile, Panama & Venezuela

-

08.10.2001 to 21.10.2001

c) The PDEXCIL participated in the ITMF Conference organised at Budapest, Hungary from 23^rd to 25^th of September, 2001, which was attended by Shri M.Y. Momin, Chairman PDEXCIL and 2 past Chairmen, Shri Dhanpal A. Tare & Shri M.S. Mathivanan.

(8) The Council projected its various activities in the realms of powerloom development and export promotion, through the media of advertisement, publicity and publications funded by the Council, as spelt out hereinbelow;

a)The Council brought out brochures depicting the Council, its mandate profile/activities for distribution to the trade, industry, importers, buyers, departmental stores, buying agents, import promotion agencies, etc.

b) Publicity of the Council was mounted through advertisements released abroad and in India in various publications/ print media during the fiscal year 2001-2002. The publicity of the Council’s activities was supplemented by the support of the press who actively involved themselves by bringing out press communiqué in the concerned newspapers, in the course of the various events of the PDEXCIL round the year.

c) Information was regularly disseminated to the members through the Council’s newsletters.

d) The Council is in the process of bringing out the 3^rd edition of Fabric Guide which serves as a product reference guide by the Indian Embassies abroad, Chambers of Commerce and Industry, Industrial Houses, Importing authorities, Import Promotion Agencies and the Foreign Departmental Stores abroad while making their purchasing decisions. The fabrics displayed in the Fabric Guide gets worldwide exposure and instrumental in obtaining orders for many of our manufacturer-exporters. In addition to the above, it serves as a good publicity media for marketing the powerloom products.

Membership :

The membership of the Council stood at 4,821 as on 31.03.2002.