The Indian textile industry occupies a unique position in the economy of the country in terms of production, exports, and employment. To enhance the potential of the industry, and upgrade it in the context of industrial liberalization and globalization, the Technology Up-gradation Fund (TUF) was formed.
Textile industry consists of major sectors such as Cotton/Manmade Fibre, handloom and handicrafts industry. Under TUF scheme, sectors of textile industry that are eligible for concessional loans regarding technology up gradation requirements are identified.
Technology levels are benchmarked in specific terms for each sector of the industry. Machinery and technology levels that are lesser than the specified benchmark are considered as not qualified for funding.
With TUF, low cost capital has become the sole motivator for existing businesses to expand, and new businesses to enter in the arena. A textile unit needs maximum working capital right from spinning to garment making.
Spinning mills depend on the availability of raw cotton at the right price. TUF only takes care of financing regarding the fixed assets. The issues of arranging for finance to meet the working capital requirements is still a matter of concern for the company, which has availed of the TUF scheme.
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Fibre2fashion News Desk - India
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