Budget leaves textile sector in cold

Kathmandu, Jun 1

Nepal Textile Association (NTA) has said that the budget of the coming fiscal year 2020/21 was mum in terms of addressing the challenges the coronavirus pandemic posed to the textile industries.

Issuing a press statement, NTA said that there were no programme to support the revival of the industry of the sector, instead existing facilities were severed.

"It is contradictory that the budget that announced economic rehabilitation does not have programmes to address textile sector that employs 50 thousand people directly," it said.

It said that while the textile industries were unable to obtain the grants on interest on bank loan as announced by the government earlier, the budget of the coming fiscal has removed the discounts on electricity charges.

"We are surprised and stunned by this decision. We see it as a policy to discourage the domestic textile industry. The government seems to be insensitive to our problems," read the statement.

According to the NTA, the budget of the current fiscal had curtailed some of the facilities enjoyed by the industries for a couple of decades such as adjustment of Value Added Tax but despite multiple efforts from the entrepreneurs the government turned deaf ears to their demands.

"This time we had submitted written suggestions to the government but none of them were addressed. So we have reached a conclusion that there is no alternative to shutting the business," it said.

It challenged the government to either announce steps to address the demands of the sector or facilitate in shutting down the industries.

While we are losing our competitive capacity due to smuggling of cloth from India or with under-invoicing the government did not try to respond to these immediate needs, it said.

"There are 250 textile factories in operation in Nepal. While we are planning to support the government in the campaign to creating employment by creating about 500,000 jobs in next five years, the latter has shown an indifference to the development of this highly potential sector," it said.

Published in The Rising Nepal daily 2 June 2020.