Essay on Union Budget and Indian Textile Sector
The Indian Textiles Industry has an overwhelming presence in the economic life of the country. India employees about 100 million people in various forms related to the textile industry. This number is about 1/3rd of the total population of the United States. Owing to the employment and revenue generation, India has a cabinet level ministry for the textile sector.
Textile sector can be broadly categorized into jute, sericulture, wool & woolen, man-made fiber & filament yarn industry. The Indian textiles industry contributes substantially to India’s GDP and exports earnings. The export basket consists of wide range of items containing cotton yarn and fabrics, man-made …show more content…
The budgetary support for technology upgradation, tackling pollution and boosting competitiveness to the Indian textile sector and restoring the ‘zero excise duty route’ for clothing industry, setting up of Apparel Parks will help in strengthening the sector. Key budgetary support schemes presented in the new Indian budget are:
1) continuation of the Technology Upgradation Fund (TUF) Scheme :
Almost all the associations have requested for the extension of TUFS scheme for the 12th five year plan (starting FY13-17). TUFS was introduced in 1999 to catalyze investments in all the sub-sectors of textiles and jute industry by way of 5 per cent interest reimbursement.
TUFS has catalyzed investments of Rs 2.08 lakh crore during its operational life span of over 11 years. However in April 11, the Government has launched restructured TUFS with an overall subsidy of Rs 1972 crore till end of FY12. This subsidy is expected to leverage an investment of Rs.46900 crore, with sectorial investment shares of 26 per cent for spinning, 13 per cent for weaving, 21 per cent for processing, 8 per cent for garmenting and 32 per cent for others. According to the National Fiber Policy report, India requires around Rs 188000 crore of capex in Textile industry to keep up the demand during 2011-2020. Thus, encouraging capacity addition of weaving and garmenting sector will help to strengthen the loose links of