Govt okays 61 firms for textiles PLI scheme, aims Rs 19,077 cr investment

Seven foreign companies have committed total investment of Rs 3,559 crore for the plan

The government approved Thursday financial aid to 61 companies, including seven foreign ones, for its textiles production linked incentive (PLI) scheme. These companies plan investment of Rs 19,077 crore.

Part one of the scheme plans a minimum investment of Rs 300 crore and has 13 companies including Shahi Exports, Paragon Apparel, and Trident. Part two has a minimum investment of Rs 100 crore and it has 48 companies, including Arvind Ltd, Suchi Industries, and SVP Global Textiles.

Seven foreign companies--US-based Autoliv and Kimberly Clark, Israel’s Avgol, South Korea’s Evertop Textile & Apparel Complex, Germany’s Rane TRW Steering Systems, Sri Lanka’s Teejay and Japan’s Toray International--have committed investments to the tune of Rs 1,904 crore during the gestation period and total investment of Rs 3,559 crore.

A total of 67 applications were received for the PLI scheme out of which 15 applications were under Part-1 and 52 applications were under Part-2. UP Singh, Secretary in the Ministry of Textiles, said on Thursday total investment expected from the applicants is Rs 19,077 crore. The projected turnover is Rs. 184,917 crore over a period of five years, with proposed direct employment of 240,134.

Singh said that it was necessary to make a mark in manmade fibres (MMF) as well, if India wants to achieve the textile export target of $100 billion by 2030. It was on September 8 last year that the Union Cabinet had approved the scheme with a budgetary outlay of Rs 10,683 crore. The scheme was designed to boost India’s production and trade of man-made fibre (MMF), garments, and technical textiles.

For part 1 of the scheme, the minimum turnover required incentive is Rs.600 crore; and Part-2, Rs 200 crore.

Arvind Limited, which is largely into natural fibres, also has a technical textiles business under its Advanced Materials Division (AMD). That division formed roughly 12 per cent of its revenues for the nine months ended December 31, 2021. The company did not comment about its plans.

On the other hand, SVP Global Textiles Limited, which is into compact cotton yarn manufacturing, had applied for setting up a technical textiles unit under the PLI scheme for a capex of Rs 100 crore.

"We realized that we were only in the yarn segment and needed to be in the complete textiles value chain. However, instead of going for normal garmenting, we are setting up a technical textiles unit at our existing plant where we plan to manufacture protective, mobile and medical textiles initially. The new unit is expected to garner an additional revenue of Rs 175 crore per annum and we expect to grow by 25 per cent year-on-year," said Maj Gen (Dr) OP Gulia, SM, VSM (retd), chief executive officer of SVP Global Textiles Limited.

The company plans to commission the plant in the next 12-15 months with a capacity of around 4375 metric tonnes per annum.

The scheme announcement for the textiles sector comes a day after the centre removed the import duty of cotton. Cotton at present attracts 5 per cent Basic Customs Duty (BCD) and 5 per cent Agriculture Infrastructure Development Cess (AIDC). The decision to waive customs duty is seen as a move to lower domestic prices.

Elaborating on the potential of technical textiles, Singh said that sectors such as geotextiles need much more encouragement to improve use, demand and penetration and intensive research and development activities.