TUFS for Indian textiles sector to continue

The Indian textile industry’s demand for prolonging the Technology

Upgradation Fund Scheme (TUFS) seems to have been accepted as textile secretary Kiran Dhingra says the scheme would continue at least for the time being. She informed that the Textile Ministry has proposed extension of the TUFS in the 12th Five Year Plan with an allocation of Rs 158.86 billion. The restructured TUFS attaches greater importance to weaving, processing and value-added downstream segments of the textile producing industry. However, it did not meet the expected response, especially in the last year of the 11th Plan, perhaps due to waning microeconomic situation, she said.

If the performance of the scheme does not improve even during the current year, the Ministry would have to re-examine and restructure it to make it more lucrative, she added. Dhingra says they do not wish to extend a split scheme to processing beyond TUFS, and that they are quite sure that the government would attach due importance to the processing segment, and the 12th Plan would extend more assistance and encouragement to processing, as compared to that available under TUFS or any other scheme.

On debt restructuring, she said, the issue has drawn the attention of the government over the past few years, as besides industry associations, the Textiles Ministry has also raised the issue before the RBI and the Ministry of Finance. The Inter-Ministerial Committee would soon be updated regarding the troubles of the textile industry, as Bank of Baroda (BOB) Capital Markets is to present a report in this regard, to seek a debt restructuring package, she informed.

Also, she informed that the Textile Ministry has announced establishment of 21 integrated textile parks, in addition to the 40 textile parks for which the sums have already been earmarked. 24 of these 40 textile parks are already operational, while another 12 are on the verge of completion, she said.