Incidentally, it may be mentioned that China had 6 lakhs ordinary powerlooms/automatic looms prior to 2002. Today, they have shuttleless looms (2, 50, 000 to 3,00,000 approx.). There may be few ordinary powerlooms in villages and automatic shuttle looms in some corners. No estimate of such looms is available. They have installed large machinery manufacturing capacities and are also exporting all kinds of textile machinery at a cheaper price.

Therefore, the following measures are needed to improve the present condition of the Indian TEI

A) Policy Measures

• Scheme for Modernisation, technology upgradation and productivity advancement of the Textile Engineering Industry (TEI). The interest remission under the scheme should be 5% with one time 10% Capital Subsidy over & above interest remission (Similar Schemes are available for the Textile Industry).
• Scheme to support Research & Development.
  • Suitable capital grants and annual recurring grants for the existing R&D Centre at IIT, Powai, Mumbai.
  • Suitable capital grants for the R&D Institutions located at Surat, Ahmedabad, Coimbatore, Delhi, Panipat and Ludhiana willing to take up R&D for textile machinery.
• Capital grant for indigenous development of machinery to the new projects as well as existing projects which got delayed due to lack of funds.
• Tax break/holiday for the manufacture of High Speed Shuttlelesss Looms/High-tech processing and finishing machinery for a period of five years.
• To allow import of complete sophisticated machinery in CKD/ SKD condition at concessional rate of import duty for a minimum period of three years without any restrictions for manufacturing textile machinery under collaboration/joint venture/import of designs and drawings or by way of re-engineering.
• Ban import of machinery where similar technology machines are available indigenously e.g. shuttleless rapier loom crank beat-up type, water jet Looms (800 rpm) etc.
• Import of textile machinery in second hand condition should not be allowed under the Technology Upgradation Fund Scheme/20% CLCS Scheme.
• Ban on import of second hand shuttleless looms with weft insertion rate less than 800 mtrs. per minute.
• Revival of TIFAC scheme for development of textile machinery with 90% loan component and softer rate of interest of 3%.

B) Fiscal Measures

• Reduction of excise duty from 14% to 8%
• Excise duty on parts, components and accessories of the machines be reduced to 8%.
• Maintaining the floor level customs duty on textile machinery at 7.5% without any exemptions
• Uniform rate of customs duty for complete machinery and raw materials, parts, components & accessories
• Uniform treatment to the domestic suppliers of machinery to EPCG license holders.
• 150% weighted Income Tax deduction for R&D expenditure made by the Textile Engineering units.

If the above measures are taken seriously, the TEI aspires to make available modern machinery and equipment both in quantum and quality to meet the future needs of the textile industry at short delivery periods coupled with effective and prompt after-sales-service.

About the Author:

The author is the Secretary of The Textile Machinery Manufactures Association.