M. Soundariya Preetha
Customs duty reduction on polyester fibre welcomedNeed for higher outlay for building world-class capacities
COIMBATORE: The textile industry has lauded the budget announcements for the textile and clothing sector, especially extension of the Technology Upgradation Fund Scheme (TUFS).
The Confederation of Indian Textile Industry Chairman, Shekhar Agarwal, said that continuing the scheme during the entire Eleventh Plan period would provide substantial assistance to the industry to build capacities required to meet the increasing demand for textile products at home and abroad.
The allocation of Rs. 911 crore for interest subsidy reimbursement under the scheme during 2007-08 was "woefully inadequate," he said.
Substantial increase in the allocation was needed to ensure that the scheme operated smoothly. The annual requirement of TUFS funds would be about Rs. 1,250 crore, he said.
Welcoming the extension of the scheme, Prem Malik, Chairman, Cotton Textile Export Promotion Council, said high cost of capital had been an important factor that inhibited technology upgradation.
The outlay should be increased to build world-class, state-of-the-art production capacities.
The Southern India Mills Association (SIMA) Chairman, S. V. Arumugam, said the extension of the scheme would help realise the envisaged investments of Rs. 1.94 lakh crore and creation of 14 million jobs during the Eleventh Plan. "We will be able to balance our investment plans as we now know the scheme is available for another five years," he said.
Garment sector happy
The knitwear industry in Tirupur has said that the scheme was most important and the President of Tirupur Exporters' Association, A. Sakthivel, said the "garment sector is totally happy and thanks the Finance Minister for extending the much needed scheme during the Eleventh Plan and also increasing the provision of funds to the scheme."
The associations have welcomed the announcements relating to reduction in customs duty on polyester fibre and yarn from 10 per cent to 7.5 per cent and increased allocation for the Integrated Textile Park scheme. SIMA expressed disappointment that customs duty had not been brought down for other man-made fibres such as viscose.