| SITP was introduced in the budget last year, to give a fillip to the textile sector. Accordingly, it was decided that the Central government would contribute 75 per cent of the project cost as subsidy. |
| But recently, the subsidy share has been reduced to 40 per cent. Moreover, the SITP failed to evoke response from the prospective entrepreneurs who planned to invest in these parks. |
| Speaking to Business Standard, M S Madhivaanan, ex-director, Powerloom Development and Export Promotion Council (Pdexcil), said that encouraged by the successful completion of the Palladam Hi-Tech Weaving Park (PHWP) here earlier this year, three such parks at Karur, Vellakoil and Chennimalai near Erode were planned. |
| "The work at these parks is still at its nascent stage and the reduction of subsidy by the centre would further delay the work on these parks," he added. |
| These projects will not be able to utilise the one-time capital subsidy of 20 per cent for modernisation under the Technology Upgradation Fund scheme (TUFS) also, as the TUFS is scheduled to expire by March 2007. |
| "The extension of TUFS till March 2010 is still under consideration. Even if the scheme is extended, there may be restrictions on allocation of funds to Tamil Nadu, as the state already tops the list of borrowers by availing a major chunk of the fund (around 9,715 crore of the total Rs 33,500 crore). Considering the fund restrictions, we may not be able to promote the already proposed parks," according to M Senthilkumar, director of Pdexcil. |
| However, the council has submitted a proposal to the Union textiles minister to restore the Centre's subsidy share of 75 per cent and to extend the TUFS till March 2010. |
| The cloth export from the region stood at Rs 6,000 crore last year, and the garment export at Rs 30,000 crore. |
| With more investments and the scaling up of production capacities, Pdexcil foresees a 20 - 25 per cent increase in exports this year. |
Top Section
Explore Business Standard