Fall in both domestic and international prices of cotton led the Indian government to review the industry which has been in trouble recently. The Govt. has decided to restore tax rebates on raw cotton and cotton yarn for export in this regard .
From April 2014 the Duty Entitlement Pass Book (DEPB) scheme has been reinstated on a retrospective basis on cotton yarn, and on cotton from October 2010 which provides tax refunds for exporters. The Confederation of the Indian Textile Industry (CITI) welcomed its return and the DEPB was withdrawn in April last year.
To tackle the losses suffered by the industry due to restrictions on cotton yarn exports, the fluctuation in cotton and cotton yarn prices and the accumulation of stock, the CITI had asked the government for a relief package. Commerce and Industry Minister Anand Sharma admitted that cotton exports had been “dis-incentivised” by the export tax in place, and to overcome this DEPB has been restored.
