Govt proposes revival package for handloom sector

The government proposes to implement a revival, reform and restructuring package for the handloom sector to improve the condition of the sector and help access funds.

According to a proposal floated by the Textile Ministry, the much needed relief to the sector is aimed to bring it  out of the debt overhang and grow as it is the second largest employment provider next to agriculture. According to ministry officials,  low productivity of the handloom sector that employs around 43 lakh  handloom weavers on 27-28 lakh handloom household units contribute only about 11% of the total cloth production. This is major weakness of the Indian textile industry and underutilisation of the manpower and skills.

A financial estimate has pegged the cost of the package  at approximately Rs 2000 crores and the package will be implemented in  six states with major concentration of handloom weavers benefitting almost 20 lakh handloom weavers in the first phase. According to the proposal, four handloom mega clusters at Varanasi (Uttar Pradesh), Siva Sagar (Assam), Virudhunagar (Tamil Nadu and Murshidabad (West Bengal) have been taken for their integrated and holistic development.

The package consists of various schemes and subsidy proposals. Under the package, the ministry proposes to revise the mill gate scheme. The objective of this scheme is to make available all types of yarn at mill gate price to the eligible handloom weavers so as to facilitate regular supply of basic raw materials to the handloom sector. Currently, National Handloom Development Corporation (NHDC) is the implementing agency responsible for facilitating the supply of raw material to all eligible entities like handloom organisations, handloom development centres, exporters, export houses etc.  It is proposed to be open up  the scheme to include primary weavers’ society, apex society, Weavers Company for supply to eligible entities and help utilize the full employment potential of the sector

Another proposal under the package is to issue large number of bunker credit cards and loan waiver scheme, provide margin money and interest subvention with credit guarantee. Market strategies include setting up of marketing complexes at 100 strategic locations while master weavers would be linked to markets, export houses and marketing organisations for selling weaver product.  The marketing incentive will be shared 50:50 between the centre and the state government.

In order to improve the payment from handloom houses to weavers a corpus of funds for each textile cluster may be set up so that 60% payment to weavers can be made immediately after receipt of goods from weavers along with acknowledgement from the buying houses.

There would be upgrdation and modernisation of Weavers Service Centres, Indian institute of Handloom technologies. Besides large number of weavers are proposed to be bought under social safety net under scheme like health insurance scheme or Mahatma Gandhi Bunkar Bima Yojana. For seamless implementation of the schemes, handloom schemes will be converged with schemes of ministry of rural development and ministry of medium and small industry.