Transworld to invest Rs 70 cr in cotton yarn plant

Transworld Textiles Pvt Ltd, a firm promoted by technocrats, has proposed to invest Rs 70 crore in Madhya Pradesh to set up a cotton yarn-manufacturing unit.

The new unit will come up in the Kheda industrial area of Pithampur in the Dhar district of Madhya Pradesh.

A government source said: "The state apex empowerment committee on investment has recently cleared the proposal of the firm and has offered a concession of 25 per cent of premium to be payable. The firm needs 10 acres of land."

Transworld will also get other investment promotion incentives since it falls under mega projects (above Rs 25 crore).

The other incentives include 75 per cent of the total amount of value added tax/commercial tax and central sales tax deposited by the company for a period of seven years, interest grant, some concessions on entry tax.

It will also get exemption on power cess if generates captive power as defined in the Industrial Promotion Policy of 2004.

"The land area will be allotted to them on a concession. It will be available at 25 per cent of the premium of land rates," said the source.

The company will produce 8,702 metric tonnes of cotton yarn and will generate 429 jobs.

"The project is likely to take shape by July 2008," said the source, adding, "the company will arrange for funds through financial institutions and banks."

The project will require 2500 KvA of power and 150,000 litres of water per day. "The necessary infrastructure is available at the Kheda industrial area," said the government official.

The textile sector in Madhya Pradesh is looking up despite some hitches. Recently, a project of Rs 600 crore, planned by Pratibah Syntex Ltd, at the Pithampur special economic zone faced financial hurdles.

"The major issues in Pithampur area are cotton handling and transportation. The power cost and necessary infrastructure needs to be improved further in order to attract more investment in the industrial area," a textile industry source told BS.

Madhya Pradesh has 51 textile manufacturing units and most of them produce yarn. Of them 12 are 100 per cent export-oriented units and 20 composite mills with a combined capacity of 140,000 spindles.