The government partly rolling back its decisions taken in September last year, has restored benefits on cotton yarn shipments under the Incremental Export Incentivisation Scheme (IEIS) for the current fiscal, according to a notification by the directorate general of foreign trade (DGFT).

With this decision, mills would continue to get a 2% export incentive on the incremental value of cotton yarn shipments, compared with last year. The move will help textile mills as cotton yarn exports are expected to rise 25% in 2013-14 from last year's level of about 1,100 million kg.

Prem Malik, the chairman of the Confederation of Indian Textile Industry, said that the withdrawal of the IEIS had taken away the exporters enthusiasm and the restoration of these benefits will reflect in the export performance during the remaining part of this fiscal. The move came after the finance ministry raised duty drawback rates on some of the textile products, including cotton and man-made fibre, on January 21.

However, the DGFT hasn't yet restored benefits for cotton and cotton yarn under the focus market scheme, which were withdrawn on September 25 last year. Under the FMS, exporters used to get up to 4% of the freight-on-board value of cotton yarn in the form of transferable scrip.