26 February 2010 – Thiru Dayanidhi Maran, the Union Textiles Minister, has hailed the Budget Proposals-2010-11 presented in Parliament today. The Minister said that these initiative for the textiles sector as a growth spurring initiatives, which dovetail with economic revival, infrastructure development, agriculture development, inclusive growth and restoring export growth.

The Minister said that he is satisfied that National Security Fund has been created which will take care of 65 lakh handlooms weavers. The Minister further said that the capitalization of Regional Rural banks likely to help primary cooperative societies lending to Handlooms sector and doubling of corpus of Micro Finance Development Equity Fund from Rs. 200 crore to Rs. 400 crore will help the artisans and weavers. These measures recognizes the role of handlooms and handicrafts in providing employment as well as an instrument to preserve the magnificent and ancient textiles traditions of our country, Thiru Maran added.

Thiru Maran said that the interest subvention of 2% on pre-shipment credit for export of handlooms, carpets, small & medium enterprise of textiles sector products has been extended by a year till 31 March 2011.

The Minister said that shortage of skilled manpower is a major constraints faced by the textile industry. We propose to launch an Integrated Skill Development Scheme to impart employable skills along with job guarantee to 30 lakh persons over a period of five years, said the Minister. The initiative will cost Rs. 2,214 crore and the Planning Commission had approved Rs. 229 crore for the remaining period of 11th Five Year Plan. The private sector will play a major role in this initiative and we will leverage resources within the existing scheme, said the Minister. Thiru Maran expressed happiness that Finance Minister has included this initiative in Budget Speech, as this initiative will help to address the skill deficit and will ensure that the textiles sector take a quantum jump and reach US$115 billion by 2015.

The Minister also hailed the initiative of Finance Minister to provide one time grant of Rs. 200 crore to 20 Common Effluent Treatment Plant (CETP) installed by dyeing units in Tirupur, Tamil Nadu. This measure will supplement the efforts of Government of Tamil Nadu which had already provided support of Rs. 120 crore. The Minister said that Tirupur is the leading export centre mainly for hosiery and provide employment to approximately 5 lakh workforces and this measure will ensure protection of employment and smooth production and export of knitwear from Tirupur.

The Minister said that our recent initiatives for attraction FDI in textiles sector have been lauded in the Economic Survey 2009-10 and Foreign Investment will help us to modernize textiles and clothing industry and aid its integration into the global textiles market.

The Minister said that we had recommended to the Minister of Railways to use Jute Geo Textiles for their track repair and for laying of new tracks, it can save the maintenance cost by about 50%. The projected use of Jute Geo Textiles in one year alone would be about 35 thousand MT valued at Rs. 132 crores per annum and will benefit the Jute industry and farmers. This will also save the railways, to large extent, maintenance cost, said the Minister.

The Minister also thanked the Railway Minister for announcing in her Railway Budget Speech on February 24, 2010 that: “Railways will explore the possibility of using Jute Geo Textiles wherever the soil formation of the railway tract is unsuitable and weak.”

The Budget Proposals which will have a substantial impact on the growth of textiles sector are as follows:

BUDGET OUTLAYS

(1) Central Plan outlay enhanced to Rs.4,725 crore. Out of this, TUFS-Rs. 2,400 crore, SITP-Rs. 350 crore, Handlooms-Rs. 369 crore, Handicrafts-Rs. 319 crore and Sericulture-Rs. 453 crore.

  • Allocation for textiles and jute industry is Rs. 3,284 crore and a provision for North States Areas is Rs. 473 crore.
  • The total allocation for village and small Enterprises sector which include handicrafts and handlooms is Rs. 968 crore.

MEGA CLUSTERS

(2) Rs. 145 crore has been provided for development of Mega clusters in handlooms, handicrafts and powerloom.

CUSTOMS DUTY

(3) ACD @4% for import of readymade garments for retail sales has been withdrawn. The current limit of Rs. 1 lakh per annum for duty free import of samples has been enhanced to Rs. 3 lakh per annum.

EXCISE DUTY

(4) The micro small medium enterprises in textiles sector have been given full CENVAT credit on capital goods in one installment in the year of receipt of such goods and the facility of payment of excise duty in quarterly basis.

Article of bedding wholly made of full quilted textile material have been exempted from excise duty.

SOURCE: Press Information Bureau, Government of India