Under the Revised Restructured Technology Upgradation Fund Scheme (RR-TUFS) to be implemented during the 12th Plan period, government has decided to allocate funds worth Rs.11,952 crore to bring modernization in the powerloom sector.

Focusing on decentralized powerloom sector, the Textiles Minister Santosh Kumar Gangwar at the Lok Sabha said that the interest reimbursement has been raised from 5 percent to 6 percent and capital subsidy from 10 percent to 15 percent for new shuttleless looms. The margin money subsidy has also been increased from 20 percent to 30 percent with an increase in subsidy cap from Rs 1 crore to Rs 1.5 crore.

A pilot project has also been envisaged under the powerloom sector aiming at providing subsidy for developing infrastructure, common facilities and construction of factory buildings for shuttleless looms on hire purchase basis to improve their quality and production and to face the competition from domestic market as well as export market.

There has been raise in capital subsidy for handloom and silk sector from 25 percent to 30 percent, also margin money subsidy cap is increased from Rs 45 lakh to Rs 75 lakh for MSME and jute sector. The scheme has been evaluated thrice in 2003, 2006 and 2010 and all evaluations found the scheme beneficial for the textile industry and recommended its continuation.

These evaluations have found improvement in quality, turn over productivity, profitability, exports etc and a decline in cost, wastage, maintenance and labour costs etc.

The Minister said that the scheme was last reviewed by the Expenditure Finance Committee in March 2013 and it was recommended to continue the scheme in the 12th Five Year plan. A subsidy of approximately Rs 2,60,000 crore attracted under TUFS.

On the poor scenario of textile industry here, the Minister said that the meeting felt the UT offered good scope in the dyeing sector. Infrastructure available for discharge of industrial effluent should be such that there is no threat to the environment. This facility should be used for revival of well being of workers.

There is also need to set up Textile Park here and also a committee should be established with technical experts to work out modalities to reactivate the three major textile industries-Sri Bharathi Mills, Swadeshi Cotton Mills and the AFT mill- in Puducherry as they play a significant role in economice development of Puducherry.