Plans made by Government to boost Textile Sector

In order to provide a boost to the textile sector, the Government approved the “Amended Technology Upgradation Fund Scheme (A-TUFS)” in Dec 2015 for technology upgradation, with provision for one-time capital subsidy for eligible benchmarked machinery in different sectors including Technical Textiles, Garmenting, Weaving & Processing. The scheme is expected to attract an investment of Rs.1,00,000 crore
and generate employment of 30.51 lakhs. The Government has also recently announced a special package for the garment sector, containing a slew of measures for employment generation and enhancing exports. The package provides for government funding of the entire 12% employers’ contribution to the EPF in the next three years; option to employees earning less than Rs. 15000 for contributing to EPF; increasing overtime caps; fixed term employment; additional incentives for garmenting under ATUFS; enhanced duty drawbacks to include refund of state levies; reduction in the provision of 240 days to 150 days under 80 JJA to claim tax relief for garment industry. The special package is expected to generate employment to the tune of 100 lakhs, generate investment of Rs. 74,000 crore and increase exports by 30 billion US$.

Budget provisions made and Incentives being offered to boost handloom sector 

A provision of Rs. 612 crore has been made for handlooms at the BE stage in the year 2016-17. This accounts for 18.26% of the budget of the Ministry and provides an enhancement of 24% over the budget provided at the BE stage in 2015-16. The Ministry of Textiles implements the National Handloom Development Scheme, the Yarn Supply Scheme and Welfare Schemes for promoting Handlooms. Under NHDP, a marketing incentive @10% of the average sales is given to handloom agencies such as Handloom Corporations, cooperative societies and primary handloom weaver societies for preparing conditions conducive to marketing. To incentivize the handloom sector, it has been decided to provide capital subsidy @ 10% with a cap of Rs 20 crore to eligible machinery in the handloom sector under the recently approved ATUFS.

The above information was given by Minister of State, Textiles, Shri Ajay Tamta today, in a written reply to a Rajya Sabha question.