Lone Khalid CNI

Shri Giriraj Singh, Hon’ble Union Minister for Textiles, was warmly received at Ludhiana Railway Station by Dr. Romesh Khajuria, Chairman, Wool & Woollens Export Promotion Council (WWEPC), Govt of India along with Shri Harmeet Singh Bhalla, Vice Chairman, and Shri Sanjay Chawla, Additional Executive Director.
Dr Romesh Khajuria said that Hon’ble Textiles Minister during his two-days visit toured textile manufacturing units, engaged with industry representatives and assessed challenges faced by exporters. He assured them of the government’s full support in achieving the ambitious $350 billion target for the textile sector by 2030, with $100 billion specifically earmarked for textile exports. He accompanied the Hon’ble Minister during his visit to Ganga Acrowool in Doraha(near Ludhiana) and KG Exports, Ludhiana.

Ludhiana, often referred to as the “Manchester of India”, plays a pivotal role in India’s textile industry. The city is a major manufacturing and export hub, known for its high-quality yarn, knitwear and woollen hosiery products. It is a leader in winterwear production, supplying to domestic and international markets and has gained prominence in the manufacturing of technical textiles, sustainable fabrics and performance-based sportswear.
With a strong industrial base, skilled workforce and an established supply chain, Ludhiana contributes significantly to India’s textile exports and employment generation. The industry leaders in the region are working towards expanding their global presence and have urged the government to introduce targeted measures to support their export growth.
The industry strongly supports the Hon’ble Prime Minister’s 5F Vision, which aims to transform India into a global textile powerhouse by creating an integrated value chain, stated by Dr Romesh Khajuria.

Dr Khajuria further stated that the Member Exporters associated with WWEPC met with the Hon’ble Minister and strongly advocated that a Dedicated Export Promotion & Marketing Scheme under the ministry of Textiles is the need of the hour, it will help to meet the $100 billion textile export target. They emphasized that such a scheme would provide financial and logistical support for exporters, enabling them to effectively compete in global markets. The proposed scheme would include assistance for participation in international trade fairs and exhibitions, allowing Indian textile manufacturers to showcase their products to a wider audience. Additionally, it would support government-backed trade delegations and market study teams to explore new international markets and identify potential buyers. A structured branding initiative was also suggested to promote Indian textiles as a premium global product. While existing schemes like the Production Linked Incentive (PLI) and PM MITRA Parks focus on manufacturing, the industry leaders stressed the need for a specialized export marketing initiative. Competing nations are offering aggressive export incentives and without similar support, Indian exporters may struggle to maintain their competitive edge in the global textile market.

Key Concerns Raised by Exporters & Proposed Solutions

1. Inverted Duty Structure in Garment Exports
   Exporters highlighted that the current tax structure creates a liquidity crunch as they pay higher input GST (12-18%) compared to the output IGST refunds (5%). This disparity results in capital being blocked, reducing the financial flexibility of exporters.
   To address this, they proposed adjusting IGST refund rates, where 70% of the export value would be refunded at 5% and the remaining 30% at 18%. This change would help bridge the gap between input and output GST, ensuring a smoother cash flow for exporters.
2. High Freight Charges & Exchange Rate Issues
   Exporters also raised concerns about exorbitant freight charges and unfair exchange rate conversions by shipping companies. It was reported that shipping lines charge a higher exchange rate (by over ₹2 per dollar) compared to the government-notified rates, making Indian exports less competitive in global markets.
   To resolve this, the industry urged that shipping companies should be mandated to follow the official government-notified exchange rates for currency conversion, ensuring fair pricing and preventing unnecessary financial burdens on exporters.
3. Section 43B of MSME Act & Payment Challenges
   The industry expressed concerns regarding the mandatory 45-day payment rule under Section 43B of the MSME Act, which requires buyers to settle payments to micro and small enterprises within a fixed period. While this rule benefits local businesses, it poses a challenge for exporters, as international transactions typically involve longer payment cycles.
   In export trade, the entire process—from manufacturing to shipment and final payment—often takes 90 to 180 days. This makes it difficult for exporters to comply with the 45-day rule when purchasing raw materials from MSMEs. The industry proposed exempting exporters whose turnover consists of at least 50% exports from Section 43B, allowing them greater financial flexibility and the ability to compete effectively in global markets.
4. Encouraging Green Manufacturing with Solar Power
   With global markets increasingly prioritizing sustainable manufacturing and carbon credits, the industry urged the government to support the adoption of solar energy in textile units. Many international buyers are now favoring suppliers who adhere to eco-friendly practices, making it essential for Indian manufacturers to transition to renewable energy sources.
   To facilitate this shift, exporters proposed a special solar subsidy scheme for textile units that export more than 50% of their production. They also recommended that banks offer low-interest financing for solar installations. These measures would help Indian textile manufacturers earn carbon credits, reduce operational costs, and position India as a leader in sustainable textile manufacturing.
   Way Forward

The Hon’ble Minister assured the industry representatives that their concerns would be given serious consideration, reaffirming the government’s commitment to supporting the textile sector and boosting exports. He acknowledged the crucial role of Ludhiana’s textile industry in achieving the national textile export target and motivated the industrial representatives to continue their efforts toward innovation and global expansion.
WWEPC expressed its gratitude for the Minister’s visit and proactive engagement. The industry is optimistic that these policy recommendations will help improve trade flexibility, enhance financial stability and strengthen India’s position as a global textile leader.