High-level delegation to visit Ahmedabad in May to highlight Maharashtra's new investor-friendly textile policy
Undeterred by Gujarat's aggressive policies to attract investments, Maharashtra has rolled out the red carpet for Gujarat's textile sector. State textile minister Naseem Khan is expected to lead a high-level delegation in May to Ahmedabad asking Gujarat's textile industry to invest in the state in order to benefit from the newly released textile policy and slew of sops for the development of textile parks.
Maharashtra textile policy offers a 10% capital subsidy scheme for new projects in Vidarbha, Marathwada and North Maharashtra and 12.5% interest subsidy on long-term loans linked to centrally-sponsored Technology Upgradation Fund Scheme for new projects.
Khan told Business Standard, "Gujarat is the largest cotton producer and houses a large number of textile units. Therefore, it is our attempt to meet the representatives of Gujarat textile industry in Ahmedabad some time in May and ask them to make investments in a big way in Maharashtra. The government has adopted a zero-window policy, wherein all procedures would be done in a transparent manner and no government clearances are required."
Khan said the government would deposit the necessary amount towards interest and capital subsidies in the banks. According to the minister, this is for the first time the state government would be providing capital and interest subsidy to the private sector while the cooperative spinning mills in Vidharba, Marathwada and North Maharashtra would be given equity support in the ratio of own share capital (5%): Government share capital (45%): loan (50%).
Khan informed that the new textile policy aims to attract an investment of Rs 40,000 crore by 2017 and the main objective of the policy is to lay special emphasis on setting up processing units in the cotton producing sectors, expansion of the textile industry and growth of employment. It would lead to creation of 1.1 million new jobs in the sector in the next five years.
Further, Khan said Gujarat textile industry members would also be asked to invest in the proposed 14 textile parks in Maharashtra so far approved by the central government. "The state government will provide 9% capital subsidy or up to Rs nine crore, whichever is less for the infrastructure development in the proposed textile parks. This is in addition to the Rs 40 crore subsidy from the central government. Investment of Rs 750 crore each is envisaged in the development of 14 textile parks which means a total investment of Rs 10,000 crore is estimated. One textile park is expected to house 50 units. The government desires Gujarat industry also to make investment in the proposed textile parks.
Khan's move to tap investments from Gujarat, which produces 12 million bales of cotton against nine million in Maharashtra, deserves importance especially when it accounts for 12% share of the country's total textile exports. About 250 large fabric process houses are located in Ahmedabad and 350 in Surat, with the latter being the largest centre of art silk fabric producing over 40% of production in the country. The Associated Chambers of Commerce and Industry of India in its recent report said nearly 23% of the state gross domestic product comes from textile and related industries. Gujarat is the largest cotton producing state and accounts for 30% of woven fabric and 25% of decentralised powerloom sector of the country. According to Assocham, Gujarat is emerging as a technical textile hub with an industry size of over Rs 20,000 crore.
The Jayalalithaa Government in Tamil Nadu today presented a tax-free budget for 2013-14, proposing 'prudent fiscal management", amidst gloomy ...
However, the finance minister maintains that some element of subsidy will have to remain for a large section