Govt notifies amended TUF scheme, leaves out B/L period cases

Government today notified the Amended Technology Upgradation Fund Scheme (A-TUFS) which will provide one-time capital subsidy for investments in employment- and technology-intensive segments of the textile sector.
The move is aimed at promoting exports and import substitution.
However, the notification did not mention anything on the committed liabilities of around Rs 3,000 crore falling under cases in the blackout and left-out period.
The scheme, which has been introduced in place of the existing Revised Restructured TUFS (RRTUFS), will be credit linked and projects for technology upgradation covered by a prescribed limit of term loans sanctioned by the lending agencies will only be eligible for grant of benefits under it.

It will be effective for a period of seven years, up to March 31, 2022.
"In case the applicant has availed of subsidy earlier under RRTUFS, he will be eligible for only the balance amount within the overall ceiling fixed for an individual entity. The maximum subsidy for overall investment by an individual entity under ATUFS will be restricted to Rs 30 crore," a textile ministry notification said.

Moreover, the cases pending for issue of Unique Identification Number (UID) since September 2014 as per records maintained by the Office of the Textile Commissioner shall be covered under the existing RRTUF Scheme.

Every individual entity will be eligible for one-time capital subsidy only on the eligible investment, as per the specified rates and the overall subsidy cap.
"Industry is happy that the government has recognised the twin potential of the textile sector to generate maximum employment and economic development. However, we hope that the government will take care of the committed liabilities in coming days," Confederation of Indian Textile Industry (CITI) Secretary General Binoy Job told PTI.
He pegged the quantum of liabilities under the blackout and left-out period cases at around Rs 3,000 crore.
During 2010-11, the scheme was suspended for 10 months, but it was eventually restored as a close-ended scheme and restricted to future sanctions and committed liabilities reported by banks.

The close-ended scheme was introduced without sufficient notice from the government for preparation on part of lending institutions.
So, those who had invested in those 10 months in the so-called blackout period of 2010-11 were left out and are still awaiting a decision on the eligibility of TUF scheme on the black-out period.
The rate of Capital Investment Subsidy (CIS) for garment and technical textile segments has been kept at 15 per cent of the eligible machines, with CIS per individual entity at Rs 30 crore.