KEY REGULATIONS AND POLICIES

The following description is an overview of certain sector specific relevant laws and regulations in India which
are applicable to the operations of our Company. The information available in this section has been obtained
from publications available in public domain. The description of laws and regulations set out below may not be
exhaustive and is only intended to provide general information to the investors and are neither designed nor
intended to substitute for professional legal advice. For details of government approvals obtained by the
Company, see ‘Government and other Approvals’ on page 346. The statements below are based on the current
provisions of the Indian law and the judicial, regulatory and administrative interpretations thereof, which are
subject to change or modification by subsequent legislative actions, regulatory, administrative, quasi-judicial, or
judicial decisions.

TEXTILE RELATED SCHEMES AND POLICIES
National Textile Policy, 2000 (“NTP 2000”)

The NTP 2000 aims at facilitating the growth of the textile industry to attain and sustain a pre-eminent global
standing in the manufacture and export of clothing and to equip the textile industry to withstand pressure of import
penetration and maintain dominant presence in the domestic market. The industry aims at developing a strong and
vibrant textile industry that can produce quality products at acceptable process. This objective is sought to be
achieved by liberalising controls and regulations so that the different segments of the textile industry are enabled
to perform in a greater competitive environment. Major thrust areas of NTP 2000 includes increase in exports and
innovating marketing strategies, product diversification along with quality consciousness, among others.
Additionally, certain sector specific initiatives envisaged under the NTP 2000 include raw materials, clothing,
export and knitting.

OTHER APPLICABLE LAWS
Shops and Establishments Acts of various states (collectively “S&E Acts”)

The S&E Acts in India are promulgated by the state and may slightly differ from state to state. All shops and
commercial establishments operating within each state are covered by the respective S&E Acts. Shops are defined
as premises where goods are sold either by retail or wholesale or where services are rendered to customers, and
includes an office, a store-room, godown, warehouse or workhouse or work place. Establishments are defined as
shop, a commercial establishment, residential hotel, restaurant, eating-house, theatre or other places of public
amusement or entertainment. Further, establishments as defined by the act may also include such other
establishments as defined by the Government by notification in the Official Gazette.

The S&E Acts regulates a number of aspects relating to the operation of a shop or commercial establishment.
Some of the key areas regulated by the shop and establishment act include: hours of work, interval for rest and
meals, prohibition of employment of children, employment of young person or women, opening and closing hours,
close days, weekly holidays, wages for holidays, time and conditions of payment of wages, deductions from
wages, leave policy, dismissal, cleanliness, lighting and ventilation, precautions against fire, accidents and record
keeping.

Municipality Laws

Pursuant to the Constitution (Seventy-Fourth Amendment) Act,1992 the respective state legislatures in India have
power to endow the municipalities with power to implement schemes and perform functions in relation to matters
listed in the Twelfth Schedule to the Constitution of India. The respective States of India have enacted laws
empowering the municipalities to issue trade license for operating stores and implementation of regulations
relating to such license along with prescribing penalties for non-compliance.

Trademarks Act, 1999 (“Trademarks Act”)

The Trademarks Act which has replaced the Trademarks Act, 1958, came into effect on September 15, 2003.
Trademarks Act provides for the process for making an application and obtaining registration of trademarks in
India. The Trademarks Act allows for the registration of service marks and three-dimensional marks as well.

Under the Trademarks Act, the term ‘mark’ is defined to include ‘a device, brand, heading, label, ticket, name,

signature, word, letter, numeral, shape of goods, packaging or, combination of colours, or any combination
thereof.’ Under the provisions of the Trademarks Act, an application for trademark registration may be made

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