The Union government’s decision to introduce an amended technology upgradation fund scheme (A-TUFS) in place of the existing revised, restructured TUFS has brought cheer to the textile industry. The scheme would ease the financial burden of textile units and enable higher investments in the sector, industry officials said.
“A-TUFS would enable the textile industry to ease its financial position and also plan investments,” said M Senthilkumar, chairman, Southern India Mills’ Association (SIMA).
“The new scheme specifically targets employment generation and exports by encouraging apparel and garment industry,” said A Sakthivel, president, Tirupur Exporters’ Association (TEA). This will help in providing employment especially to women, and increase India’s share in global exports, he said.
The scheme would generate investments to the tune of Rs. 1 lakh crore and create over 30 lakh jobs, the government said after the cabinet approved A-TUFS. The spinning sector, however, is not likely to be included in the scheme as it already has excess capacity.
“This (A-TUFS) could trigger the growth of textile manufacturing in India,” said Naishadh Parikh, chairman, Confederation of Indian Textile Industry (CITI). “The government’s decision to make budgetary allocation for the committed liability of the earlier schemes comes as a great relief to the industry, which is going through a tough ime,” he stated.
Under the new scheme, there will be two broad categories — apparel, garment and technical textiles, where 15% subsidy would be provided on capital investment, subject to a ceiling of Rs. 30 crore for entrepreneurs over a period of five years’ and subsectors.
The remaining sub-sectors would be eligible for 10% subsidy, subject to a ceiling of Rs. 20 crore on similar lines . Abudgetary 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 A-TUFS. The scheme will come into effect from the date of notification.