Business

Following the hike in GST on shoes, the entire footwear industry in Agra went on an indefinite strike on Wednesday, taking out a protest march on the Mahatma Gandhi road.
They sent a memorandum to the Agra District Magistrate highlighting the demands of the footwear industry.
Agra’s footwear industry is considered to be the largest footwear industry in Asia.
This hike in GST will badly affect the footwear industry.
The GST hike will result in a drop in sales and credit will increase.

The Confederation of Indian Footwear Industries anticipates a demand squeeze because of the increase in raw material prices and the higher tax rate.
CIFI reckons that the higher GST rate may encourage unofficial sales – without any bills issued.
At 12 percent, unofficial sales may increase and keep the net recovery flat, making the higher GST rate counter-productive, according to the confederation.
“About 70 percent of footwear production is by small manufacturers employing 5-50 workers in small houses,” Noushad said.
“The retailers will lose margins if they don’t hike footwear prices.

Post acquisition, Ramsha Rahman holding in Mirza International increased to 0.20 per cent from 0.12 per cent, the company said.
Mirza International is India’s leading leather footwear manufacturer, marketer and exporter.
On December 10, 2021, Mirza International said its board approved a composite scheme of arrangement of RTS Fashions Private Limited, Mirza International and Redtape Limited.
There is a proposal for amalgamation of RTS Fashions Private Limited with Mirza International; and de-merger of Branded Business/ REDT APE Business of Mirza International into Redtape Limited.
Post-de-merger, the Redtape Limited is proposed to be listed at BSE & NSE.

NEW DELHI: Federal indirect tax body, the Goods and Services Tax (GST) Council, on Friday put on hold a decision to raise tax rates on several items in the textile and apparel industry amid pressure from businesses.
However, the tax rate on footwear priced up to ₹1,000 will rise to 12% from 5%, effective Saturday.
Finance minister Nirmala Sitharaman said the Council has decided to maintain status quo in the case of textile sector taxation and not to shift tax rate on items needing duty correction from 5% to 12%.
“It was decided today in the Council, textile will also be placed before the committee to be considered along with other items,” the minister said.
This panel is examining rationalisation of tax rates and slabs now.

PHOTO: REUTERSThe State Bank of Pakistan’s (SBP) Annual Report 2020-21 shows that Pakistan’s leather industry contracted significantly in FY21 which demands serious attention of the policymakers.
This drives up the cost of production, lowering the competitiveness of Pakistan’s leather products in the global export market.
What data saysData released by International Trade Centre (ITC) showed that Pakistan’s leather exports slid from $1.25 billion in 2011 to $0.85 billion in 2020.
The recent growth observed in leather exports was seen due to two reasons.
Relying only on two major institutes National Institute of Leather Technology (NILT) and Leather Product Development Institute (LPDI) to seek a greater share in the global export pie is not good.

While the GST hike is hailed by manmade fibre (MMF) manufacturers, representatives of other segments have expressed their dismay over the move.
The textiles & apparel industry had a long-pending demand for the removal ofon the manmade fibre (MMF) value chain, said the Ministry.
The GST on MMF, MMF Yarn and MMF Fabrics were 18%, 12% and 5% respectively.
Similarly, textile manufacturers dependent on the cotton value chain also disapprove of the GST hike on cotton-based products.India’s textile industry is majorly cotton-based.
A far more effective and rational approach would be to subject the entire value chain to a flat 5% GST rate.