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The Southern India Mills’ Association

Committed to Foster the Growth of the Textile Industry

Allocation for textiles reduced

Sector concerned over quantum being lower by Rs. 1,000 cr.
Allocation for the textiles sector in the Interim Budget has been reduced by over Rs. 1,000 crore.
According to the revised estimates for 2018-19, the textile and clothing sector gets Rs. 6,943 crore. For 2019-20, the Budget proposes an allocation of Rs. 5,831 crore.
Two major schemes implemented by the Ministry of Textiles — the Amended Technology Upgradation Fund Scheme and the Remission of State Levies — have seen lower allocation for 2019-20. For Amended Technology Upgradation Scheme (ATUFS), it is Rs. 700 crore for the next financial year and for the current year, the revised estimate is Rs. 622 crore. Earlier, for 2018-19, the allocation for ATUFS was Rs. 2,300 crore. In the case of Remission of State Levies (ROSL), the allocation for next fiscal is Rs. 1,000 crore. For the current year, it is Rs. 3,663 crore as against the initial allocation of Rs. 2,163 crore.
“The lower allocations are disappointing and worrisome,” said Sanjay Jain, chairman of the Confederation of Indian Textile Industry. The amount allocated to Cotton Corporation of India for MSP operations (cotton procurement) has gone up. But that depends on how cotton prices move. There are arrears pending for payment to industries from ATUFS. With lower provisioning for next year too, “we will be grossly under-provided,” he said. The industry had been asking for higher ROSL, he added.
A. Sakthivel, vice-chairman, Apparel Export Promotion Council, said the industry expected an announcement on reimbursement of embedded taxes with duty drawback and ROSL. “This is an Interim Budget. So, we expect our demand will be addressed in three or four months,” he added.