India’s apparel exports grew 31.7 per cent in April 2017 compared to the same period last year. The main reason for this is the Rebate of State Levies (ROSL) on exports of garments. It helped the industry increase production at very competitive rates for a larger share of global markets.
During March to April 2017, Indian garment exporters were able to increase production by around 30 per cent for achieving this growth and employed at least five per cent more workers during the same period.
An overwhelming proportion of beneficiaries of the ROSL scheme are exporters with a turnover of less than Rs 10 crores a year.
The ROSL scheme was introduced in March 2017 initially for three years. The ROSL scheme is in tune with the recognized economic principle of zero rating of export products and in recognition of the fact that at present only central levies are rebated by way of drawback schemes.
Exporters want ROSL to be continued under the GST regime. They feel any dilution in the ROSL scheme will hit the apparel export sector badly, impacting job growth.