GST is expected to create additional 20 mn jobs: Sanjay Lalbhai
Sanjay Lalbhai, Chairman & Managing Director, Arvind Ltd in conversation with Indianretailer.com discusses about the new tax regime and its future outcome.BY Sunil Pol | July 07, 2017 | comments ( 0 ) |
While there is all around talk about GST going to boost GDP along with export earnings, it is also expected to create significant amount of jobs across value chain along with pushing Indian textile industry to become modern and globally more competitive. Also while there is sense that GST is only good for big organized players the branded players thinking in a way that the new tax regime could spurt a war between honest and dishonest and one’s ability to evade taxes will definitely get compromised. Thus, expressing his views about the new tax regime and its future outcome Sanjay Lalbhai, Chairman & Managing Director, Arvind Ltd. spoke to Indianretailer.com on the occasion of inauguration of Textiles India 2017 that happened last week in Gandhinagar, Gujarat.
What is your view of GST?
This is a historic, bold and transformative reform that will remove barriers between the states to make it one nation one tax. This tax will help integrate the informal sector and provide everybody a level playing field, especially for those who are compliant both big and small players. GST will push Indian textile industry to become modern and globally more competitive. At $100 bn plus the Indian textile industry is second only to China and offers huge potential for us to develop and grow on multiple fronts like world scale, garmenting innovation, sustainability and growth in the fields like manmade fibers and technical textiles. This is expected to create an additional 20 mn jobs in the country and contribute to GDP and export earnings.
Why is there a feeling in the industry that GST is only good for big players?
GST is one of the biggest reforms we have ever seen since independence. I think the whole feeling is going out that GST is good for large organized companies. It is not a question of organized large players winning. It is good for small as well as every player who wants to be compliant. With this move the compliant honesty is going to be rewarded. Everyone wants to pay the taxes honestly and if you are not honest and evading taxes, then IT system will trace you. Hence, one’s ability to evade taxes will definitely get compromised in a way industry can progress if honesty is rewarded. GST is a game changer.
Will this new tax structure boost revenues?
As far as cost is concerned, GST is revenue neutral rate for the entire value chain. The rate which has been fixed for entire value chain is very reasonable from cotton to final garments or brands selling to the retailers. Thus, the end consumer will not be at all affected by this move.
What reactions do you expect from textile industry post GST?
Around 70 percent of people in the industry are unhappy. But, people who are not compliant are unhappy or who have been evading taxes. It is a war between honesty and dishonesty. Every honest guy should welcome it. Because you cannot put honesty at a disadvantage, no system in the world puts honesty at disadvantage, which was a situation with India and GST has corrected it.
Will there be change in prices of apparels going forward?
Price should not change much, upto Rs 1000 price tag it should go down and beyond Rs 1000 there may be a correction. But again I don’t think there will be a correction. The correction could happen because of cotton like raw materials.
Do you think that the government is supporting artisans and craftsmen?
Government has been supportive towards the artisans and craftsmen, providing a much needed boost to the unique textile tradition. Textiles India is a platform that brings all value chain participants together for exchange of ideas, trade and collaboration.
24 Nov 2015, Hotel Pullman, Aerocity, New Delhi.
Attend First global conference & master class on franchising.
GROW YOUR BRAND FRANCHISE >> REGISTER NOW!