ROLLBACK GST INCREASE ON HANDMADE TEXTILES

The decision of GST council to increase taxes on textile and apparel items from 5% to 12% effective Jan 2022 will demolish the handmade industries of India already hanging by a thread, and threaten the livelihoods of millions of weavers & artisans engaged in the handloom and handicraft sectors.

According to differing estimates, between 1.4 and 4 crore people in India earn their livelihoods through the handloom & handicraft sector, second only to agriculture. A large part of this sector focuses on handmade textiles which are handwoven or hand embellished. This sector is the financial and cultural lifeline for millions in our country and consists largely of skilled, rural women workers who earn under Rs. 5000/ a month. These craftspeople received their first jolt when they were brought within the purview of GST. With little to no skills to manage accounting and filing of GST, they need to pay professionals to deal with this from their meagre earnings.

Craftspeople help to keep alive our invaluable intangible cultural heritage. The handmade sector contributes to local rural & urban markets across the country, as well as export markets. It requires few resources and creates beauty in a green manner with a very low carbon footprint. Most raw materials are sourced from nature and the use of electric machines is almost nil.

Weavers & artisans are already struggling to cope with the disastrous repercussions of the pandemic, ranging from loss of demand and markets and rise in prices of all kinds.  With the recent huge rise in raw material prices of cotton & silk yarns, [nearly 30-40 per cent], along with an increase in prices of chemicals and dyes, a GST rise will be the death of this industry. It will not only become expensive to manage or run production, but also make it very difficult to market an already labour-intensive product struggling to compete with machine made imitations. Craftspeople who have abysmal profit margins right now will be simply unviable.

This GST hike is a contradiction of the #Vocal4Handmade campaign launched by the government on the 6th National Handloom Day (Aug 7, 2020)  “in partnership with all stakeholders, to promote the handloom legacy of India and to ensure people’s support for the weaving community”.

Handlooms and handicrafts have, for years not only been one of the key pillars of the rural economy, but also have conserved the rich cultural tradition of our country. Today, this very industry stands vulnerable and uncared for. The citizens of India appeal to the GST council to rollback the GST hike on all handmade textiles in order to protect the livelihoods of millions of artisans and India’s cultural heritage.