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Surprise bounty for textile technology

business Updated: Jul 07, 2009 00:52 IST
HT Correspondent

The textile ministry's flagship scheme Technology Upgradation Fund Scheme (TUFS) got an out of turn three fold increase in allocation of funds in the 2009-10 budget.

TUFS which was devised for encouraging investment in the sector provides for 5 per cent reimbursement of interest charged by lending agencies in the textiles sector. The budget has allocated funds to the tune of Rs 3,140 crore from last year’s Rs 1,090 crore.

“TUFS is by far the most successful scheme in the textile sector but because of inadequate budget allocation, there has been a backlog of more than a year in funds disbursement,” said R.K. Dalmia, President, Century Textiles Ltd.

The ten year old scheme has led to a cumulative investment of Rs 1,50,000 crore, making up the bulk of all investment that have trickled in the sector during the period.

But even with this increase in allocation, the scheme is likely to run out of funds way before the end of the current fiscal.