Surat Textile Traders’ Sales Fell 40% Post GST
The implementation of the Goods and Services Tax (GST) has led to a drop of 30-40 per cent in the textile sales in Surat, according to the Federation of Surat Textile Traders Association (FOSTTA). The association claims that the new tax regime has led to a loss of 4 lakh jobs, while daily production has decreased from 4 crore metres to 2.5 crore metres.
A number of textile units in Surat are running below their respective capacities and traders are facing payment delays in the aftermath of GST rollout. GST and demonetisation have affected the textile trade in Surat, resulting in a 40 per cent decrease in production, said media reports quoting Champalal Bothra, secretary, FOSTTA.
The textile industry of Surat employs about 1.3 million workers, but 30-50 per cent of the employees have lost their jobs after demonetisation and GST. The association said that textile and related industries like embroidery, power looms and artisans are losing jobs.
FOSTTA has also written to Union textile minister Smriti Irani, informing her about the situation in Surat and requesting government’s support and intervention.
A majority of the textile and other related units in Surat are unorganised and are thus facing problems in implementing the structure of the new tax regime. This is leading to a decline in production as well as demand. Artisans skilled in embroidery are losing their jobs, while textile labourers are returning to their home states due to lack of work, said Manoj Agarwal, president. FOSTTA.
Exports have also been affected due to GST. Multiple export orders have been cancelled as refund was not received on time, and payment delays have led to a shortage in working capital. The association estimates that exports have declined 60 per cent after GST implementation