Interviews
TUFS assistance for 2006-07 not disbursed by most banks
07 May '07
3 min read
Shri Shekhar Agarwal, Chairman, CITI has written to Shri Shankersinh Vaghela, Honourable Minister of Textiles on the problems suffered by TUFS from inadequacy of funds and from the recent decision of the Cabinet to cover synthetic fibre manufacturing industry under the Scheme.
Following is the reproduction of the same, for information:
We are grateful to the Government of India for extending the Technology Upgradation Fund Scheme for the Textile and Clothing Industry to the 11th Five Year Plan period. We are aware that this extension is the result of your serious and strenuous efforts and textile and clothing industry is grateful to you for this.
There are complaints from all over the country that TUFS assistance for the year 2006-07 has not been disbursed by most of the financial institutions and banks. While some lenders have made some reimbursements for the 1st quarter i.e. April - June 2006, almost the entire reimbursement is pending for the subsequent 3 quarters of the last financial year.
This backlog is likely to be over Rs.1,000 crore. I am sure that you are aware of the problems faced by the industry because of this huge backlog in TUFS, especially in the context of the present slowdown in both the domestic and international markets.
The allocation of Rs. 911 crore for 2007-08 is not sufficient to meet even the backlog of 2006-07. The requirement of TUFS assistance for 2007-08 against loans sanctioned in the earlier years will also be over Rs. 1,000 crore. Thus an additional allocation of over Rs. 1,100 crore will be required to ensure that the Scheme operates smoothly during the current year.
In this backdrop, we are extremely surprised to see reports that the Union Cabinet has given its approval for including synthetic fibre manufacturing industry within the coverage of TUFS. As you are aware, synthetic fibre manufacturers are very few in number and the industry, by and large, consists of large and profit making units which have the strength to finance their investment requirements without any Government assistance. In any case, this industry comes under the Ministry of Petrochemicals and any assistance to it should come only from that Ministry.
Following is the reproduction of the same, for information:
We are grateful to the Government of India for extending the Technology Upgradation Fund Scheme for the Textile and Clothing Industry to the 11th Five Year Plan period. We are aware that this extension is the result of your serious and strenuous efforts and textile and clothing industry is grateful to you for this.
There are complaints from all over the country that TUFS assistance for the year 2006-07 has not been disbursed by most of the financial institutions and banks. While some lenders have made some reimbursements for the 1st quarter i.e. April - June 2006, almost the entire reimbursement is pending for the subsequent 3 quarters of the last financial year.
This backlog is likely to be over Rs.1,000 crore. I am sure that you are aware of the problems faced by the industry because of this huge backlog in TUFS, especially in the context of the present slowdown in both the domestic and international markets.
The allocation of Rs. 911 crore for 2007-08 is not sufficient to meet even the backlog of 2006-07. The requirement of TUFS assistance for 2007-08 against loans sanctioned in the earlier years will also be over Rs. 1,000 crore. Thus an additional allocation of over Rs. 1,100 crore will be required to ensure that the Scheme operates smoothly during the current year.
In this backdrop, we are extremely surprised to see reports that the Union Cabinet has given its approval for including synthetic fibre manufacturing industry within the coverage of TUFS. As you are aware, synthetic fibre manufacturers are very few in number and the industry, by and large, consists of large and profit making units which have the strength to finance their investment requirements without any Government assistance. In any case, this industry comes under the Ministry of Petrochemicals and any assistance to it should come only from that Ministry.
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