Union Budget & Punjab Industries

     Every year in the last week of February month Union finance minister of India present government budget in the parliament for the next year which starts from April month, it is based on to the feedback, recommendations, proposals from different section of society, and sometimes proposed items/tax in the budget roll back by finance minister due to pressure & voices’ against it from public. Punjab State is world famous for sports goods industry, hosiery, hand tools, cycle industries which spread in three cities of state these are Jalandhar, Ludhiana and Amritsar, but due to increasing cost, labour, competition from other states of country and cheap goods arriving from china make these units existence under tough environments. This year budget present by Union Finance Minister Mr. Pranab Mukherjee was full of shocks for the industries of Punjab due to proposal of exercise taxes on to one hundred and thirty industries and it covers all the mentioned well known industries of Punjab, if proposal of excise duty implemented then all sector units will come under intense pressure because it will give extra teeth to the concerned department of Government of India. From the time budget present by finance minister all sector united against the recommendations of finance minister of excise duty and they are vocal and protesting collectively, not only trying to convince but also putting pressure on to government to roll back the propose tax as per there opinion it will ruin scores of plants in the country and can become reason of close down of plants.
   Punjab has different industries hub in three districts of state Amritsar, Jalandhar and Ludhiana and products produce from these units which are world known are –

• Amritsar – Blankets, Shawls and processing.
• Jalandhar – Sports goods, sanitary goods, Pipe fittings, Rubber goods and Hand tools units which are spread in the Jalandhar district.
• Ludhiana – Hosiery units, readymade garments, branded clothes, sewing machines, cycle units and hosiery yarn are world known and export from Ludhiana district.

with proposal of excise duty in the budget, it included all the above sector, are going to hit badly, propose excise duty on to above coded units recommended –

• readymade garments, branded garments and blankets it is ten percent.
• cycle, sports goods, sewing machines it is one percent.

but due to increase cost courtesy costly labour, shortage of raw materials, competition from other states of country and top of it supply of cheap goods from china all these are source of bleeding of these industries and as it was not enough now they have to face government officials which will harass them unnecessarily all it is going to make there existence hard. Branded garment companies will effect more severely of ten percent excise as they use to get there production from small units now there input cost will increase by ten percent on to sale of there products which was already expensive compare to local made garments, as per stats available, right now in the country there are total half a million units which are producing clothes, and six million persons are employed with these units, turnover of these half a million units are one and half trillion rupees from domestic sale plus half a trillion from exports to other countries.
      Considering the above, Union Finance Minister again contemplate on to the recommendations of excise duty on to garments units as it is going to hit badly, in the era of stiff competition, when it is already a tough environments to survive, if it wont roll back then score of garment plants are going to face the heat of excise duty and can close down there operations in the coming time.