A call by India's textiles minister for a higher rebate on duties paid on garment exports to the European Union (EU) will probably be refused by the country's finance ministry, just-style reported. K Sambasiva Rao, India's textiles minister, recently proposed to increase the duty rebate rate by 5 percent for Indian apparel and textile exporters to compensate for losses due to Pakistan acquiring the Generalised System of Preferences (GSP) Plus status, which will see many of its EU exports attract preferential import tariffs until 2017. According to Darshan Lal Sharma, a member of the Confederation of Indian Industry's (CII) National Committee on Textiles and a director of Vardhman Textiles, getting an increased drawback approved would be a real challenge when there is pressure to reduce the country's fiscal deficit. The Confederation of Indian Textile Industry (CITI) said that Pakistan's zero duty status has made Indian garments less competitive by 9.6 percent and textiles by 5 percent to 6 percent. This disparity could be reduced if some additional incentive could be given but according to CITI, the government is not likely to take action any time soon. The finalization of the EU-India free trade agreement, which would also help, is still under discussion. Progress has been slowed by German elections last year, the sluggish EU economy, and upcoming elections in India.

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