Pest Analysis of Retail Apprel Industry

3442 Words Mar 3rd, 2013 14 Pages
PEST Analysis of Indian Market for the Apparel Industry

1. Political Factors:

The proliferation of international trade and liberalization of the global trade regime has dawned in India with the implementation of several programs by the Government of India (termed as GOI from now onwards in the report) to help the textile and apparel industry adjust to the new trade environment. In 2000, the GOI unveiled its National Textile Policy (NTP) 2000, aimed at enhancing the competitiveness of the textile and apparel industry and expanding India’s share of world textile and apparel exports to 10 per cent by 2010 from the current 3 per cent level. Some of these measures taken by the GOI were substantial to facilitate the Brand Accessory
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The Excise law ensures a CENVAT Credit Scheme, which limits the cascading effect of duty incident on number of excisable goods that are used as inputs/capital goods for manufacturing other excisable goods. The scheme suggests that CENVAT credit can be claimed on the excise duty, special excise duty and additional duty of customs imposed on raw materials and capital goods, whether purchased locally or imported. This credit can be utilized for the payment of excise duty on the finished product.

Customs Duty Customs duty is levied on import of goods into India. A downward trend in customs duty rates has been seen over the past few years. This ensures free import of raw materials required for the production of Labels & Tags.

Other Taxes In addition to above, some other taxes imposed by central / state government are as follows:
• Transfer of assets attracts stamp duty
• Some states impose real estate taxes based on asset values
• Municipalities levy tax on real estate in their jurisdiction and octroi on goods entering their jurisdiction.

VALUE ADDED TAX In case the tags are supplied to the garment manufacturing vendors outside India there is no charge of Central Excise and Value Added Tax (from now onwards termed as VAT in the report) besides the basic cost and the freight charges. In case the tags are to be supplied to vendors within India payments are done on the base of a
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