Textile industry associations have hailed the clearance of the new Technology Upgradation Fund (TUF) Scheme for the entire 12th Plan period.
Welcoming the decision, the Southern India Mills Association Chairman S. Dinakaran said that this scheme of the Textiles Ministry had attracted over Rs 2.53 lakh cr of investments since its introduction in 1999.
Though the investments have been substantial so far, in recent months, they had almost come to a standstill in the absence of a new scheme.
The clearance of the scheme with greater focus on the weaving sector would improve investments in this sector. This sector has so far not achieved the envisaged growth due to inadequate technology.
The association has thanked Union Minister of Textiles K. Sambasiva Rao for increasing the interest subsidy by one percentage point to six per cent, and the capital subsidy from 10 per cent to 15 per cent for new shuttleless looms. The SIMA chief also welcomed the allocation of Rs 300 crore for the powerloom sector under a scheme that would enable the small and medium players modernise their technology with the support of master weavers; for increasing the margin money subsidy to 30 per cent and for enhancing the limit from Rs 1 crore to Rs 1.5 crore for the powerloom sector.
The sectoral cap of 26 per cent for the spinning sector under the new scheme is yet another welcome move, said Dinakaran and expressed hope that the spinning sector would be given the existing interest rate subsidy to help convert the surplus cotton of up to 100 lakh bales into yarn, fabric and other value-added products.