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Govt allocates Rs 11,952 cr for powerloom sector

Margin money subsidy has also been increased from 20% to 30% with an increase in subsidy cap from Rs 1 crore to Rs 1.5 crore

Press Trust of India  |  New Delhi 

With an aim to modernise the powerloom sector in the country, government has allocated Rs 11,952 crore under the Revised Restructured Technology Upgradation Fund Scheme (RR-TUFS) to be implemented during the 12th Plan period.

Textiles Minister Santosh Kumar Gangwar said in Lok Sabha that to give emphasis on decentralised powerloom sector, interest reimbursement and capital subsidy for new shuttleless looms have been raised from 5% to 6% and 10% to 15% respectively.

The margin money subsidy has also been increased from 20% to 30% with an increase in subsidy cap from Rs 1 crore to Rs 1.5 crore, he said.

The Minister said a pilot project has also been envisaged under the powerloom sector which aims at providing subsidy for developing infrastructure, common facilities, construction of factory buildings and for shuttleless looms on hire purchase basis to improve their quality and production and to face the competition from domestic market as well as export market.

"Capital subsidy has been increased from 25% to 30% for handloom and silk sector, margin money subsidy cap is increased from Rs 45 lakh to Rs 75 lakh for MSME and jute sector," he said.

Gangwar said the scheme has been evaluated thrice in 2003, 2006 and 2010 and all evaluations found the scheme beneficial for the textile industry and recommended its continuation.

"These evaluations have found improvement in quality, turn over productivity, profitability, exports etc and a decline in cost, wastage, maintenance and labour costs etc," he said.

The Minister said the scheme was last reviewed by the Expenditure Finance Committee in March 2013 and it was recommended to continue the scheme in the 12th Five Year plan. A subsidy of approximately Rs 2,60,000 crore attracted under TUFS.

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First Published: Thu, July 31 2014. 14:12 IST