CCEA clears continuation of powerloom cluster development

Says modified scheme with an outlay of Rs 110 cr for the 12th Plan will be implemented through a PPP model

The government today cleared the continuation of a cluster development scheme that aims to assist entrepreneurs in setting up world-class units in the powerloom sector.

"The Cabinet Committee on Economic Affairs (CCEA) today gave its approval for continuation of Comprehensive Powerloom Cluster Development Scheme (CPCDS) during the 12th Plan (2012-17)," Information and Broadcasting Minister Manish Tewari told reporters here after the meeting.

Besides, it cleared the plan for modification of norms of the scheme for development of Powerloom Mega Clusters at Ichalkaranji, Bhiwandi (Maharashtra) and future projects, an official release said.

The modified scheme with an outlay of Rs 110 crore for the 12th Plan will be implemented through a Public-Private- Partnership (PPP) model, it said.

In 2008-09, the government had launched the CPCDS for development of Powerloom Mega Clusters at Bhiwandi and Erode (Tamil Nadu) during the 11th Five-Year Plan, with a budget provision of Rs 70 crore for each cluster.

Later on, the government announced development of two more Powerloom Mega Clusters at Bhilwara (Rajasthan) in 2009-10 and at Ichalkaranji (Maharashtra) in 2012-13.

The scheme is aimed at assisting the entrepreneurs to set up world-class units with modern infrastructure, latest technology and adequate training and human resource development inputs along with appropriate market linkages.

The CPCDS assistance under the modified scheme would supplement the development of existing brownfield facilities and infrastructure; and enhance their productivity through provision of common infrastructure facilities, modern technology, designing, testing and skill development, it said.

The important changes approved in the modified guidelines in the current Plan with reference to the existing projects include changes in the investment ratio. The funding will be in the ratio of government:private - 60:40 from the government:private - 40:60 in 11th Plan, the release said.

Also, the overall limit of CPCDS grant has been reduced to Rs 50 crore from Rs 70 crore (each cluster) in the 11th Plan and the investment would be in the brownfield projects which was earlier allowed in greenfield and brownfield.

The Textiles Ministry has been running this scheme with an aim to strengthen, modernise and expand the market base of the powerloom sector.

This sector plays an important role in the textiles economy in terms of fabric production and employment generation. As on March 31, 2011, there were about 5.18 lakh powerloom units with 22.92 lakh powerlooms.