Haryana's Textile Policy to boost investments, spur development of textile sector

Credit rating agency ICRA on Wednesday announced that the Haryana state government recently announced the state specific Textile Policy on April 2017 that aims for integrated development of the textile industry with the state, at the same time remove the current mismatch across the value chain.

According to an ICRA report, the new state policy introduces measures such as capital subsidy at 10 percent for investment in Plant and Machinery (P&M) eligible under ATUFS (Amended TUFS).

This will reduce the project cost upon commissioning; Interest subsidy in the range of ~four to six percent in the scheme for all types of new textile units, depending on the area/ category of district and; Support for establishing textile parks in terms of additional fiscal incentives as well as infrastructure augmentation. This is in addition to the Central Government's scheme for Integrated Textile Parks (SITP) to support the overall industrial growth in this sector.

"States of Maharashtra, Gujarat, Madhya Pradesh among others already have state textile policies in place for facilitating investments in the sector. These states have benefited over the years from these policies, as is evident from the capacity additions. In this context, the benefits proposed in the Haryana Textile Policy are expected to make the state competitive for investments for the textile sector going forward," said Senior Vice President and Group head ICRA, Jayanta Roy.

The policy is structured to provide relatively higher incentives in Category C and D blocks (defined under the Enterprises Promotion Policy, 2015, as industrially backward areas), as compared to Category A and B Blocks (defined as industrially developed and intermediate developed areas).

Besides, the policy will also supplement the central policies for the textile sector.