NEW DELHI: The recent hike in duty drawback rates by the government would help boost the garment sector's exports, exporters body AEPC said today.
Duty drawback is the refund of duties on imported inputs for export items.
Last week, the Finance Ministry has rationalised the duty drawback and brought more items under the scheme for tax refundto exporters to give a boost to overseas shipments.
"The move would give a boost to overseas shipments. Government has announced duty drawback for the garment cotton, manmade and silk for the year 2013-14. This is a critical incentive which we all need," Apparel Export Promotion Council (AEPC) Chairman A Sakthivel said in a statement.
He said that the sector imports large quantities of raw material to make items for export purposes.
The revised All Industry Rates of duty drawback will come into effect from September 21.
The drawback rates for the garment cotton, man made and silk have been increased to 7.6 per cent, 10.2 per cent and 7.8 per cent respectively for 2013-14, he said.
India's garment exports grew by 19 per cent year-on-year to USD 1.27 billion in July. The country's over all exports rose to a two-year high of 13 per cent in August on account of improved global situation.