Indian Textiles Ministry to launch VC fund for start-ups

25 Sep '14

3 min read

The Government of India, Ministry of Textiles, will soon launch a venture capital (VC) fund to provide equity to start-up entrepreneurs, Santosh Kumar Gangwar, Minister of State (Independent Charge) for Textiles, said at the annual conference of the State Textiles Ministers in New Delhi.

The Tex-Venture Capital Fund will be launched in association with the Small Industries Development Bank of India (SIDBI) with an initial corpus of Rs. 350 million.

The conference of the State Textiles Ministers, held for the first time after the new Government took over in May, 2014, was attended by Ministers looking after Textiles from 16 States, who gave their considered views/suggestions on various issues relating to promotion of handlooms and handicrafts, sericulture as well as development of powerloom, setting up Textiles Parks, Incubation Centres, Research Institutions, Mega Clusters as well as on State specific issues.

The State Ministers also gave their views on the draft vision, strategy and action plan prepared by the Ministry. Ministers of the North Eastern States requested for provision of adequate assistance and relaxed norms for meeting the needs of the region.

It was decided that handloom will be promoted with focus on developing high-end niche products by linking it with contemporary fashion. Further, e-marketing initiatives will be pursued which will cut down intermediaries and increase wage earning of the weavers. This would make the handloom attractive to younger generations as well.

Secondly, promotion of handicrafts and handloom villages will be linked up with tourism, and traditional handloom weaver/handicraft artisan villages will be promoted as tourist destinations.

It was also decided that guidelines of the Scheme for Integrated Textile Parks (SITPs) and Scheme for Incubation Centres will be examined and amended suitably for meeting the field level needs as indicated by the State Governments.

Mr. Gangwar invited proposals from the State governments for establishment of more integrated textile parks.

To help the textile industry by providing environment-friendly processing technology, the Ministry announced the Integrated Processing Development Scheme for setting up new processing parks as well as support upgradation of existing processing clusters specifically in the area of water and waste water management.

Under the scheme, the Centre will provide financial support of up to 50 percent of the project cost with a maximum ceiling of Rs. 750 million in case of zero-liquid discharge units and Rs. 100 million in case of common effluent treatment plant. States will provide 25 percent of the project cost and the remaining will be mobilised by the SPV.

India’s textiles and clothing industry is one of the mainstays of the national economy. It is also one of the largest contributing sectors of India’s exports contributing nearly 13.25 percent of the country’s total exports basket. The textiles sector has realised export earnings of US$ 41.57 billion in 2013-14. (RKS)

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