Industry & Economy
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Textiles
Textile tech fund scheme extended
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Customs duty on polyester fibre, yarn slashed
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Meeting challenges
Enhanced allocation of Rs 425 crore for textile parks under the Scheme for Integrated Textile Parks has been announced.
The Government proposes to develop an additional 100-150 handloom clusters in 2007-08.
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New Delhi
Feb. 28
In line with the textile sector's long-pending demand, the Union Finance Minister, Mr P. Chidambaram, today announced a five-year extension for the Technology Upgradation Fund Scheme (TUFS). Customs duty on polyester fibre and yarns, as well as manmade fibre raw materials, has also been slashed in the Budget.
"A rejuvenated textile industry is geared to meet the global challenge. TUFS will be continued during the Eleventh Plan and against a provision of Rs 535 crore in 2006-07, Rs 911 crore would be provided for TUFS in 2007-08," Mr Chidambaram said while presenting the Budget.
Enhanced Allocation
The scheme, launched in 1999 to provide interest and capital subsidy for modernisation of the textile sector, was slated to expire in March 2007.
The Finance Minister also announced an enhanced allocation of Rs 425 crore for textile parks under the Scheme for Integrated Textile Parks (SITP).
"So far, out of the 30 parks sanctioned under SITP, 26 have been approved. The provision for these parks has been increased from Rs 189 crore to Rs 425 crore in 2007-08," Mr Chidambaram said. He also announced a cut in customs duty on polyester fibre and yarns to 7.5 per cent from 10 per cent.
On the handloom sector, Mr Chidambaram said the Government proposes to develop an additional 100-150 handloom clusters in 2007-08. The cluster approach for the sector was introduced in 2005-06 and has covered 120 clusters.
Capacity Building
Allocation for the sector has been enhanced from Rs 241 crore in 2006-07 to Rs 321 crore in 2007-08. He also announced a rationalisation of schemes for the sector, with the 12 schemes being implemented at present, slated to be grouped into five schemes during the Eleventh Plan period, he added.
Mr Mukund Choudhary
Commenting on the Budget proposals, Mr Mukund Choudhary, MD, Spentex Industries Ltd, said the continuation of the TUFS during the Eleventh Plan was a step in line with industry demand and the hike in allocation for the scheme was also a step towards capacity building in the sector. "Spentex is bullish on the Customs duty cut on PFY and on DMT/PTA," he said.
Mr Shekhar Agarwal
The Chairman of Confederation of Indian Textile Industry, Mr Shekhar Agarwal, while welcoming the continuance of TUFS as a means for ensuring capacity building, pointed out that the allotment of Rs 911 crore made for TUFS for 2007-08 would, however, be "woefully inadequate."
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