Italian investors are keen on setting up a special economic zone for the textile secor in India and foraying into fashion retailing through single brand stores, the chief of a leading industry body has said.
Italian designers are also exploring the possibilities of using India as a back office for their designing, production and marketing activities, according to President of Federation of Indian Chambers of Commerce and Industry Saroj Poddar.
He said India has necessary resources to provide support to the Italian designers in manufacturing high-value fashion garments.
An official delegation led by Indian Commerce Minister Kamal Nath is now in Italy to explore new business opportunities and enhance bilateral trade between the two countries, which have agreed to boost two-way commerce from 4.3 billion dollars at present to ten billion dollars by 2009.
The Indian Textile Ministry is pushing for Special Economic Zone (SEZ) benefits for 26 industrial parks, which are being built under a scheme for integrated textile parks. This is expected to spin off considerable financial benefits for textile companies trying to cash in on quota-free international textile regime.
Such benefits could include benefits for textile firms like 15-year tax holiday, 100 percent income tax exemption for the first five years, 50 percent for the next five years and cent percent exemption on the profits recycled into the business for the last five years.
Service tax exemption and zero duty on capital goods are also part of the benefits that could accrue if SEZ status is granted to textile parks.
Under the scheme for integrated textile parks, the Textile Ministry provides infrastructure like roads, telecom and captive power plants for firms willing to set up units there.
The goods manufactured in these parks can either be exported or sold in domestic market and if these parks have high exports, they can get SEZ benefits, ministry sources said.
