Feasibility report on TUFS extension in two months

The Union ministry of textiles has commissioned KSA Technopak, a consultancy firm, to study and prepare a feasibility report on the extension of the popular Technology Upgradation Fund Scheme (TUFS) till 2010, according to J N Singh, Union textiles commissioner.

On the sidelines of 'Comptex 2006', a textile fair jointly organised by CII and SIMA, Singh said the study was commissioned last month and the report is likely to be ready in the next two months.

The study would concentrate on the investments made in the textile industry, improvement in productivity, increase in exports and machinery upgradation encompassing all the sectors of the industry like spinning, weaving and processing.

It would also prepare a report on the benefits gained by the textile units across the country under the TUFS and the sustainability of the impact after the extension of the scheme, Singh added.

Stating that the TUFS would be phased out in March 2007, so far the fund has been able to mobilise about Rs 33,500 crore, Singh said. He expects another Rs 20,000 crore investments to come up before March 2007.

"Out of this Rs 33,500 crore, 29 per cent has been advanced to the units in Tamil Nadu. The State occupies top slot in the list of states that have availed a major chunk of bankable funds under the TUFS," he added.

The textile industry in Coimbatore region has pumped in more than Rs 2,000 crore as new investments in the past two years or so. This investment is based on the rough estimate of about one million new spindle equivalent capacity creation seen by the spinning and composite mills in the region, according to sources in the Southern India Mills' Association (SIMA).

Delivering the valedictory address at the fair, Manikam Ramaswami, chairman, Confederation of Indian Industry's (southern region) textiles sub-committee, said that the deployment of information technology (IT) in textile industry would make it globally competitive.

The hidden costs mainly in the form of the in-process inventory held between various stages of textile production chain is estimated in the range of 10-20 per cent of the manufacturing cost, he added.

"Though India enjoyed advantages in the field of raw materials like lower cotton prices and its spinning sector being world class, the fragmented industry, especially in the downstream operation where the enormous costs are being allowed to go uncaptured, make the textile production incompetitive," Ramaswami said.

Speaking on the occasion, M Sivakkanan, ex-chairman of the Handloom Export Promotion Council (HEPC), said that management practices and technology were 'business enablers' that would help meet the global challenges of market forces.

"Business strategy has to be strongly supported by IT, which would organise information from manufacturing, sales and finance and human resource and enable data sharing for better decision making," he added.