CHENNAI: Chief Minister MK Stalin has urged the Union government to frame a new policy to safeguard export sectors from the impact of the US tariff hike.
In a statement, Stalin announced that the 50 per cent tax hike has taken effect, and industries exporting to the US are in fear. "Moreover, the US is an important export market for Tamil Nadu. During the last fiscal, about 31 per cent of Tamil Nadu's exports were to the US. Meanwhile, India has 20 per cent of its total exports to the US. Tamil Nadu is the most affected State," he pointed out.
Saying that several orders from the US had been cancelled, Stalin added that the tax hike had rendered the State less competitive on a global level.
"The measures taken by the Union government to face the challenge are not sufficient. Tamil Nadu is doing what it can, but there are certain limits to the State's jurisdiction. The Union government should frame a policy for the textile industry. According to the assessment by Guidance Tamil Nadu, the tax hike is expected to result in a total loss of USD 3.93 billion to the state of Tamil Nadu. Textiles, machinery, diamond and jewellery, and automobile parts industries will face 36 per cent job loss," Stalin warned.
Stalin recalled a letter he had sent to Prime Minister Narendra Modi on August 16, demanding some relief in GST, and stated that after sending the letter, GST on cotton imports was suspended until December 31. While praising the decision, Stalin said that the measure offers only a temporary solution.