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Rana not fully satisfied with TUF scheme

Our Bureau

COIMBATORE, June 24

THE Textiles Minister, Mr. Kanshiram Rana, has said that he was not ``fully satisfied'' with the performance of the Technology Upgradation Fund (TUF) scheme.

He, however, expressed the hope that the TUF scheme would pick up, particularly with relaxations in the financial and technical norms such as change in the promoters ratio, linking co-operative lending agencies for direct finance announced subsequently.

The Minister said as on June 21, as much as Rs. 3,125 crores had been sanctioned under TUF (for project cost of Rs. 7,089 crores) and the amount disbursed stood at Rs. 789 crores.

While admitting that there were some problems in the TUF scheme progress initially, he said the dilutions in the norms had helped in achieving the targets set for the March-June quarter. He pointed out that the initial difficulty on the part of the finan cial institutions in extending support to user industries remained subdued now.

Mr. Rana, however, felt that though he had been receiving requests for further increase in financial subsidy for TUF projects from certain sectors such as the textile processors, it would not be possible to further increase the interest subsidy.

Even at the current level of subsidy incorporated in the TUF scheme, the Government had to bear Rs. 3,000 crores as interest subsidy for the TUF projects. Taking into account of this subsidy, the gap between the prime lending rate of 13 per cent and the TUF lending (after adjusting the subsidy of five per cent) at 7.5 per cent was already wide, he added.

Mr. Rana was earlier inaugurated a pilot project on jute particle board manufacturing put up under the UNDP-Government of India sponsored jute diversification project in the PSG College of Technology's jute/textile division at Neelambur near here.

While addressing the members of the Indian Chamber of Commerce and Industry, he said the country's textile export target for the 2000-2001 fiscal had been fixed at Rs. 65,000 crores as against Rs. 58,000 crores fixed for 1999-2000 fiscal.