Rs 16600 Crore Scheme To Replace ATUFS

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The government has begun work on a new scheme with an outlay of about Rs 16,600 crore for the next five years for textile machinery manufacturing, support to technology upgradation in existing clusters and micro, small and medium enterprises (MSMEs), and support for new integrated manufacturing facilities in various segments including spinning, weaving and knitting.

The new scheme, Textile Technology Development Scheme, will replace the Amended Technology Upgradation Fund Scheme (ATUFS), which ends on March 31, 2022. Beneficiaries of the production-linked incentive (PLI) scheme for textiles would not be eligible for incentives under the new programme, said officials.

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According to reports, the scheme is at a conceptual stage, and is awating approvals from various levels. The thrust on manufacturing textile machinery is crucial as India imported shuttleless looms, sewing machines and knitting machines, among others, and accessories such as spindles and needles worth almost Rs 72,000 crore in the past five years, mostly from China.

The textile ministry has proposed investment and value-addition linked incentives under the scheme. Incentives for technology transfer in case of joint ventures by foreign manufacturers, and support for research and development and commercialisation, are also likely to figure in the planned scheme as it seeks to encourage indigenous manufacturing of machinery with a focus on the garmenting sector.

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Thresholds and caps for the incentives are also in the works, according to officials. “Sustainability, compliance, innovation and job creation are the focus areas of the new scheme. It aims to improve scale and technology simultaneously through integrated modern textiles manufacturing,” an industry representative involved in the consultations said on condition of anonymity.

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