Amended Technology Upgradation Fund Scheme for textiles gets nod
Tribune News Service
New Delhi, December 30
The Cabinet Committee on Economic Affairs (CCEA) today approved a modified subsidy scheme for the textiles industry which is expected to generate large-scale investment of Rs 1 lakh crore and create 30 lakh jobs.
The CCEA approved the introduction of Amended Technology Upgradation Fund Scheme (ATUFS) in place of the existing Revised Restructured Technology Upgradation Fund Scheme (RR-TUFS), for technology upgrade of the textiles industry.
The government said the scheme will enable Make in India initiatives for the textile sector. It will also enable large job creation as textiles industry is a labour-intensive sector and supports huge employment.
A report by Crisil Research last year pointed out that textiles has a high labour intensity of 16, which means that 16 workers are required to produce Rs 1 million of output. It has a significant share in manufacturing employment (34%) and also accounts for a high share of manufacturing output (11%). It employed around 17 million workers (in spinning, weaving, finishing of textiles and readymade garments) in fiscal 2012. However, its share in manufacturing GDP has declined over time as productivity suffered due to small size units.
As per an official statement, a budget provision of Rs 17,822 crore has been approved, of which Rs 12,671 crore is for committed liabilities under the ongoing scheme, and Rs 5,151 crore is for new cases under ATUFS.
All cases pending with the Office of Textile Commissioner shall be provided assistance. The Office of Textile Commissioner (TXC) is being reorganised and its offices will be set up in each state.
The new scheme will have two broad categories. Apparel, garment and technical textiles will be provided 15% subsidy on capital investment, subject to a ceiling of Rs 30 crore for entrepreneurs over a period of five years.
The remaining sub-sectors would be eligible for subsidy at a rate of 10%, subject to a ceiling of Rs 20 crore on similar lines.
A Cabinet statement said the scheme will target employment generation and export by encouraging apparel and garment industry, which will provide employment to women in particular and increase India’s share in global exports.
It will also promote technical textiles, a sunrise sector, for export and employment and promote conversion of existing looms to better technology looms for improvement in quality and productivity.
Under the TUFS scheme, a sum of Rs. 21,347 crore has been provided as assistance to the industry during 1999-2015. It has led to investments worth Rs 2.71 lakh crore and created job opportunities for nearly 48 lakh people.
