MUMBAI: The garment industry is likely to post an annual growth of 12-15 per cent in the wake of budgetary measures like removal of excise duty on branded garments, Clothing Manufacturers Association of India (CMAI) said today.
"We expect Indian garment industry to grow by 12-15 per cent per annum due to abolition of 12 per cent excise duty in the Union Budget," CMAI President Rahul Mehta said in a statement here.
The excise duty on branded readymade garments was removed in the budget in the wake of industry witnessing almost zero per cent growth in 2011-13.
The industry will also be benefited by imposition of 12 per cent countervailing duty on import of garments from Bangladesh, he said.
Earlier, import of garments from Bangladesh did not attract import duty nor there was any quota and Bangladesh was used to dumping cheap garments made of Chinese fabrics in India.
Now, budget has imposed 12 per cent Countervailing Duty (CVD) plus Education Cess (3 per cent of CVD) on garment exports to India from Bangladesh which will provide buffer to domestic industry, he said.
This will also encourage foreign retailers setting up shop in India to manufacture their requirements in India, rather than import finished garments from other countries, he said.
The industry is estimated to be worth around Rs 2 lakh crore with exports accounting for another Rs 60,000 to Rs 70,000 crore.