Lok Sabha Question No. 2930 (UNSTARRED), answered on 2021-03-12
Subject: Subsidy/tax Exemption for Textile Industries
Ministry: TEXTILES
Asked by: Darshana Vikram Jardosh, Shivkumar Chanabasappa Udasi

## LOK SABHA UNSTARRED QUESTION NO. 2930 TO BE ANSWERED ON 12.03.2021

## SUBSIDY/TAX EXEMPTION FOR TEXTILE INDUSTRIES

## 2930.   SHRIMATI DARSHANA VIKRAM JARDOSH: SHRI SHIVAKUMAR C. UDASI:

## Will the Minister of TEXTILES वस्त्र मंत्री

be pleased to state :

- (a) whether the Government is planning to provide any subsidy/tax exemption for textile industries, particularly  in  Surat  as  several  textile  industries  are  suffering  due  to  COVID  and  subsequent lockdown in the State of Gujarat and if so, the details thereof;
- (b) whether the Government has formulated any proposal to mitigate the loss of jobs and reduction in market growth of cotton textile industry in the country, particularly in Gujarat;
- (c) if so, the details thereof, State-wise; and
- (d) the steps taken by the Government to increase employment generation in textile industry?

## उत्तर

## ANSWER

## वस्त्र मंत्री ( श्रीमती स्मृतत ज़ूबिन इरानी )

MINISTER OF TEXTILES (SMT. SMRITI ZUBIN IRANI)

(a): The government of  India  has  launched  Amended  Technology  Upgradation  Fund  Scheme (ATUFS) in January 2016 with an outlay of Rs. 17,822 crore upto 2022 on pan-India including the state  of  Gujarat.  Every  eligible  individual  entity  (not  the  unit)  is  entitled  for  reimbursement  of Capital Investment Subsidy (CIS) under this scheme, as per the following rates:

| S.No.   | Segment                                                                                                                                                                        | Rate of Capital Investment Subsidy (CIS)      |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------|
| 1.      | Garmenting, Technical Textiles                                                                                                                                                 | 15% subject to an upper limit of Rs 30 crores |
| 2.      | Weaving for brand new Shuttle-less Looms (including weaving preparatory and knitting), Processing, Jute, Silk and Handloom.                                                    | 10% subject to an upper limit of Rs 20 crores |
| 3(a)    | Composite unit /Multiple Segments - If the eligible capital investment in respect of Garmenting and Technical Textiles category is more than 50% of the eligible project cost. | 15% subject to an upper limit of Rs 30 crores |
| 3(b)    | Composite unit/ Multiple Segments - If the eligible capital investment in respect of Garmenting and Technical Textiles category is less than 50% of the eligible project cost. | 10% subject to an upper limit of Rs 20 crores |

Further, considering the socio economic impact of Covid-19 outbreak, a provision has been provided to the units for exercising an option to get the Joint Inspection Team(JIT) recommended subsidy released before verification of the JIT reports by submitting bank guarantee against the value of  recommended  subsidy.  This  facility  has  been  extended  to  the  cases  both  under  ATUFS  and previous Version of TUFS and made available for 6 months.

(b) & (c): The  global  pandemic  of  Covid-19  affected  various  industrial  sectors  in  the  country including  the textile  sector. The  government  has  taken  following  initiatives/  measures  to  help ameliorate the conditions in textile sector to boost production, marketing and job opportunities in the sector on pan-India including the state of Gujarat:

- i. In  order  to  make  the  textile  sector  competitive  by  rebating  all  taxes/levies  in  international market, the Government has decided to continue the RoSCTL (Rebate of State and Central Taxes and Levies) scheme until such time the RoSCTL scheme is merged with Remission of Duties and Taxes on Exported Products (RoDTEP)  scheme.  For this purpose, the Government has approved adhoc allocation of funds of Rs. 7398 crore for FY 2020-21 for issuance of duty credit scrips under RoSCTL scheme.
- ii. Further,  in  order  to  boost  exports  in  MMF  sector,  Government  has  removed  anti-dumping duty on PTA (Purified Terephtallic Acid), a key raw material for the manufacture of MMF fibre and yarn and also on Acrylic  fibre.
- iii. The Government  has  announced a  special  economic  package  viz . AatmaNirbhar  Bharat Abhiyaan  for  boosting  economy  of  the  country  and  making  India  self-reliant.  Relief  and credit support measures have been announced for various sectors. The weavers & artisans of textile  sector  can  avail  benefits  of  these  relief  and  credit  support  measures  to  revive  their businesses which have suffered due to lock down necessitated by Covid-19 pandemic.
- iv. To support the handloom and handicraft sectors and to enable wider market for handloom weavers/artisans/producers, steps have been taken to on-board weavers/artisans on Government e-Market place (GeM) to enable them to sell their products directly to various Government Departments and organizations.
- v. A social media campaign #Vocal4handmade was launched on the 6 th National Handloom Day by the Government, in partnership with all stakeholders, to promote the handloom legacy of India and to ensure people's support for the weaving community.
- vi. Textile and garment manufacturers all over the country including Gujarat contributed to the growth of PPE industry and India became globally the second largest manufacturer of PPEs. As  per  estimates  based  on  inputs  provided  by  the  industry,  the  country  has  manufactured nearly 6 crore PPE body coveralls and 15 crore N-95 masks during April to December 2020 period  (as  per  data  available).  Nearly  1100  manufacturers  had  registered  for  PPE  Body Coveralls  and  more  than  200  manufacturers  for  N-95  mask  manufacturing.  The  average market size of this newly created industry is around Rs. 7000 crores.

(d): The government has taken following initiatives which have large potential for employment generation in the textiles sector:

- i. The Government had approved a special package for textile sector with an outlay of Rs. 6000 crores to boost employment generation and exports particularly in Garmenting and Made-ups.
- ii. In  order  to  bring  the  import  of  raw  silk  to  Zero  level,  indigenous  manufacturing  and establishment of large scale Automatic Silk Reeling Machine(ARM) has been promoted for the  first  time  since  2016-17.  67  ARMs  have  been  distributed.  These  will  also  boost  the employment generation.
- iii. National  Technical  Textiles  Mission  launched  in  budget  announcements  in  February  2020 with  an  outlay  of  Rs.  1480  crore  for  the  period  2020-24,  with  a  view  to  become  a  global player in technical textiles and place India as one of the major exporting countries is likely to generate a large number of employment in the textile sector.
- iv. Union  Budget  2021-22  announcements  include  launch  of  the  scheme  of  setting  up  mega investment  textile  parks.  These  parks  with  manufacturing  units, when  operational  ,  will generate large employment.
- v. The Production Linked Investment scheme covering MMF and Technical Textiles sector has been announced  which will create global champions in exports and thus boost employment.