The government to improve the low prevailing efficiency of handloom sector plan to implement a revival, reform and restructuring package. Handloom sector with 27-28 lakh handloom household units and around 43 lakh handloom weavers working is able to contribute only 11% of the total cloth production, thus needs attention.

The Indian Textile Ministry has come up with a proposal aimed to reduce the debt overhang face by the handloom sector and help it grow.

A financial estimate cost of the package is marked at approximately Rs 2000 crores and the package will be put into executed in six states with major focus on handloom weavers. In the first phase, they plan to provide benefit to almost 20 lakh handloom weavers.

The package consists of various schemes and subsidy proposals. Under the package, the ministry proposes to modify the mill gate scheme. Under this scheme all types of yarn will be made available at mill gate price to the eligible handloom weavers so as to facilitate regular supply of basic raw materials to the handloom sector.

Currently, National Handloom Development Corporation (NHDC) facilitates the supply of raw material to all eligible entities like handloom organizations, handloom development centres, exporters, export houses etc. This scheme will also include primary weavers’ society, apex society, Weavers Company to help utilize the full employment potential of the sector.

Another proposal under the package is to issue large number of bunker credit cards and loan waiver scheme, provide margin money and interest subvention with credit guarantee. Market strategies include setting up of marketing complexes at 100 strategic locations while master weavers will be linked to markets, export houses and marketing organizations for selling weaver product. The marketing incentive will be shared 50:50 between the centre and the state government.

Further, to improve the payment from handloom houses to weavers a corpus of funds for each textile cluster may be set up so that 60% payment to weavers can be made immediately after receipt of goods from weavers along with acknowledgement from the buying houses.

According to the proposal, four handloom mega clusters at Varanasi (Uttar Pradesh), Siva Sagar (Assam), Virudhunagar (Tamil Nadu and Murshidabad (West Bengal) have been taken for their integrated and holistic development.

For flawless implementation of the schemes, handloom schemes will be clubbed with schemes of ministry of rural development and ministry of medium and small industry.

Weavers Service Centres, Indian institute of Handloom technologies will undergo upgradation and modernization. Besides large number of weavers are proposed to be bought under social safety net under scheme like health insurance scheme or Mahatma Gandhi Bunkar Bima Yojana.