Government Resolution No.: Policy 2017/C.R. 6/Text-5 Dated 17th February, 2018

1. Period of the Textile Policy

This Textile Policy will come into effect from the date of issuance of this Government Resolution and will continue to be in effect till 31st March, 2023.

2. Definitions

1. Existing Project: Any project existing prior to the announcement of this policy and any project coming under expansion / diversification / modernization during the period of this

2. New Project: Any project established and starting production during the period of this policy.

3. Expansion Project: Any existing project increasing its gross fixed capital investment by 25% and increasing its total production capacity by 25% as compared to the previous year will be considered as expansion or diversification. Such expansion and / or diversification will include forward and backward integration.

4. Gross Capital Investment: Investment in machinery before expansion / diversification / modernization and / or investment made from financial assistance approved by financial institutions /

5. Modernization Project: Conversion of old simple powerloom to shuttle-less rapier loom and to any loom based on advanced

6. Diversification Project: Any project undertaken by an existing unit to produce additional product(s) of the textile value

7. Project Cost: Aggregate cost of land, building and

8. Eligible Machinery: Machinery eligible under centrally sponsored TUFS scheme (including any subsequent modifications by the Central Government to these schemes) or machinery approved by the State

9. Eligible Amount: Long term loans for capital subsidy under the centrally sponsored TUFS scheme (including any subsequent modifications by the Central Government to these schemes) or long term loans (excluding taxes) approved by financial institutions or banks for machinery approved by the State

10. Eligible amount for self-financed projects: As per the criteria of centrally sponsored TUFS scheme (including any subsequent modifications by the Central Government to these schemes) or cost of machinery (excluding tax) approved by the State

11. Eligibility for Capital Subsidy: The eligibility for capital subsidy will be decided based on the installed capacity of the project and actual annual

12. Composite Unit: A project comprising minimum two activities of the value chain, i.e. spinning, weaving, knitting, processing and

13. Technical Textiles: Such textile production which is aimed not only at fabric production but also at creating products which could be used in the industrial, defence, research and other advanced sectors due to its specialized technical properties. These products are classified into following categories based on their quality and end use:

(1) Agro tech, (2) Build tech, (3) Cloth tech, (4) Geo tech (5) Home tech, (6) Ind tech , (7) Medi tech, (8) Mobile tech, (9) Echo tech, (10) Pack tech, (11) Pro tech (Protective textile) (12) Sport tech, (13) Defence tech, (14) Products announced by Textiles Ministry of Central Government from time to time.

14. TUF Scheme: Amended Technology Upgradation Funds Scheme (A-TUFS) of the Central Government or any scheme amended by the Central Government from time to time.

3. Textile Components included in Textile policy 2018-23:

1. Cotton ginning and pressing

2. Spinning / silk reeling and twisting / integrated silk park / synthetic filament / yarn texturing, crimping and twisting

3. Weaving and powerloom

4. Technical textile, non-woven and converters of non-woven

5. Knitting / hosiery / garment / apparel & made-up

6. Processing of fiber / yarn / fabric / garments / made-ups

7. Processing of non-conventional fiber / yarn / fabrics / garments / made-ups (bamboo, banana, ghaypat, maize, coir, hemp, etc)

8. Expansion of existing textiles units

9. Textile Parks / processing parks

10. Energy saving and process control equipment for various textile sectors

11. Skill development activities

12. Wool sector (i.e. scouring, combing, spinning (worsted, shoddy and woolen) and weaving and carpet

13. Standalone spinning

14. Spinning with matching downstream capacity

15. Manufacturing viscose filament yarn / viscose staple fiber

16. Independent weaving preparatory

17. Embroidery on standalone basis

18. Composite upgradation (i.e. units going for upgradation in spinning, weaving / knitting and processing)

19. Multi-activities (units with two or more activities simultaneously except composite upgradation mentioned above)

20. Composite unit

21. Other units of textile industry not mentioned herein

4. Scheme under Textile Policy 2011-17: Projects which have submitted their applications (Form A) under Textile Policy 2011-17 will continue to receive the benefits declared under that policy till the beneficiary period of that project.

5. Extension to the Textile Policy 2011-17:

The long term loans approved from 18 April 2016 to 15 February 2018 will be eligible for benefits as per the Government Resolution 2015/C.R 364/Text-5 dated 18 April 2016. Further, the self-financed projects which have ordered machinery between 2 December 2015 and 15 February 2018 will be eligible for benefits as per the Government Resolution dated 2 December 2015.

6. Following schemes will be implemented for the development of Textile industry under Textile Policy 2018-23:

6.1 Power looms:

State scheme for modernization of plain powerlooms: The State Government will provide the following grant to the powerloom owners who have received the grant from the Central Government under the centrally sponsored “Pilot scheme of in situ upgradation of plain powerloom for SSI Sector” for modification of plain powerlooms:

Sr No Type of modernization Subsidy rate per loom
General Category

(35%)

Scheduled Castes

(20%)

Scheduled Tribes

(8%)

1 Conversion of simple powerloom to Semi- Automatic shuttle loom Rs 10,000/- Rs 6,800/- Rs 2,400/-
2 Conversion of Semi- Automatic shuttle loom to Shuttle less rapier loom Rs 17,500/- Rs 10,000/- Rs 4,000/-
3 Conversion of simple powerloom to Shuttle less rapier loom Rs 28,000/- Rs 16,000/- Rs 6,400/-

This scheme will be implemented as per the terms and conditions of the Central Government scheme. The policy of sanctioning financial assistance after receipt of beneficiary details from the Central Government will be followed. If the scheme is modified by the Central Government then the State Government will also modify the scheme accordingly.

6.2 Capital Subsidy in lieu of Interest Subsidy: The policy of capital subsidy in lieu of Interest subsidy to the new, expansion & diversification / modernization projects undertaken during the Textile Policy 2011-17 will be continued with modifications in the Textile Policy 2018-23. Additional capital subsidy will be granted to processing plants set up in the cotton growing areas of Vidharbha, Marathwada and North Maharashtra. The details of the Capital subsidy rate and the duration for various textiles units are as follows:

Type of Textile
Processing (yarn, fabric, printing), Technical textile Knitting, Hosiery and Garmenting* Composite Unit ** Spinning, Ginning, Pressing Conversion of Old Plain powerlooms to Shuttle less Rapier looms or looms based on latest technology (Modernization of powerlooms) New Powerlooms based on latest technology (Other than plain Powerloom), Weaving, Preparatory, Warping, Sizing, Conning, Twisting, Doubling, TFO and other textile units excluding those mentioned at Col 2 to 5
1 2 3 4 5 6
% of eligible amount % of eligible amount % of eligible amount % of eligible amount % of eligible amount
Subsidy to units in the General

Category

40% 35% 25% 25% 25%
Subsidy to units in the SC /ST/ Minority category 45% 40% 30% 30% 30%
Additional subsidy for production of Yarn, fabric and other products from non-conventional

Yarn

10% 10% 10%
 

The following additional subsidies will be applicable for textile projects in the Vidarbha, Marathwada and North Maharashtra regions:

Type of Textile
% of eligible amount % of eligible amount % of eligible amount % of eligible amount % of eligible amount
Additional Capital

Subsidy

20% 10% 10% 10% 10%
Additional subsidy for units having Forward/ Backward Integration 5% 5% 5%
Additional subsidy for units set up in a taluka not having any existing Spinning mills 5%
5% Additional subsidy for new composite unit set up in a taluka not having any Co- Operative or Private spinning

Mill

5%

* Construction cost of ETP / CETP / ZLD in the processing projects will be eligible for capital subsidy.

** Composite Unit: If particulars mentioned in Column 2 are not included then 35% for other processes and if particulars mentioned in Column 2 are included then 40% for those specific processes.

♣ 5% additional capital subsidy for projects with investment of Rs. 500 crore and above. If it is the first project / pioneering project in that taluka then additional 5%, totaling to 10% capital subsidy will be  applicable.

Capital Subsidy will be disbursed as follows:

1. First Instalment: 30% of eligible amount after 12 months from start of production

2. Second Instalment: 30% of eligible amount after 24 months from start of production

3. Third Instalment: 40% of eligible amount after 36 months from start of production

The following projects will be eligible under this scheme:

a) Projects for which the long term loan has been approved for machinery under the centrally sponsored TUFS scheme from the date of issuance of this Government Resolution or thereafter till 31 March 2023.

b) Ginning and spinning projects for which the long term loan has been approved till 31 March 2023 by banks / financial institutions and where the projects have submitted Form-A on the State Government website.

6.3 Capital subsidy for self-financed Projects:

  • New / Expansion / Diversification / Modernization self-financed textile projects will be granted capital subsidy as per capital subsidy in lieu of Interest Subsidy Scheme.
  • Self-financed projects in the Vidarbha, Marathwada and North Maharashtra regions will be granted additional capital Subsidy.
  • Textile projects of scheduled castes / scheduled tribes / minority communities will be granted capital subsidy as per the above mentioned capital subsidy in lieu of Interest Subsidy Scheme.
  • Terms and conditions of Government Resolutions dated 2 December 2015 and 18 December 2015 will be applicable to the capital subsidy in lieu of Interest Subsidy Scheme for self-financed projects with necessary modifications

6.4 Textile Parks

  • The scheme of providing Rs. 9 crore or 9% of project cost, whichever is lower, to the projects by the State Government and those which are approved under Central Government SITP scheme (Government Resolution dated 25 May 2012) will be continued.
  • Integrated Textile Hubs / Parks by the MIDC will be set up at Amravati, Aurangabad, Beed, Buldhana, Jalna, Jalgaon, Nanded, Parbhani, Yavatmal and Wardha. Essential infrastructure such as roads, water, electricity, etc. and facilities of testing labs and CETP will be provided at these Integrated Textile Hubs / Parks. At least 100 Ha land at each of these Mega Integrated Textile Hubs will be developed.
  • Similar Textile Hubs / Parks will be set up as per requirement in the Vidarbha, Marathwada and North Maharashtra regions through MIDC.
  • Textile Parks / Hubs will be established by MIDC at Ichalkaranji (Hatkanangle) and Solapur.

6.5 Processing ( Pre & Post)

  • The existing State scheme of 25% of project cost or Rs. 37.5 crore whichever is lower for projects approved under centrally sponsored IPDS scheme (Government Resolution dated 10/02/2015) will be continued.
  • Capital subsidy will be given for machinery required for ZLD / ETP / CETP in the processing projects.
  • Processing parks including CETP will be set up in coastal areas by MIDC.
  • Land for hard waste disposal will be provided in respective districts.
  • Processing parks including ZLD / ETP / CETP will be set up on priority by the MIDC at Ichalkaranji, Malegaon and Bhiwandi.
  • Processing projects having ZLD / ETP / CETP will be provided with electricity at a concessional rates since the costs of operating the ZLD / ETP / CETP projects and the hard waste disposal are very high.
  • Financial assistance will be provided to institutes such as SASMIRA and IIT to set up water free / effluent free dyeing / processing projects.
  • Water will be reserved for processing plants since these plants require large quantities of water.

6.6 Knitting, Hosiery and Garmenting

  • Plug & play premises will be established by MIDC in each District / Taluka of Vidarbha, Marathwada and North Maharashtra for setting up of knitting, hosiery and garmenting units.
  • These premises will have facilities like Common Facilitation Centre, Worker Training Centre, etc. These facilities will be run by unit owners associations / co-operative societies / private limited companies, etc.
  • Schemes tailor-made to meet the working requirements of women will be formulated for setting up of decentralized knitting, hosiery and garmenting units for women in their rural regions.
  • Garment parks will be established at Nagpur and Solapur through funds generated by sale of Narsingh Giriji Spinning Mill at Solapur and Empress Mill at Nagpur. Remaining funds will be transferred to the “Textile Development Fund”.
  • Training of workers and entrepreneurs will be conducted by industrial bodies and NGOs through the Central Government’s skill development schemes, CFCs and State Government’s Pramod Mahajan Skill Development Scheme. These trainings will include hard skills, soft skills and life competencies skills.

6.7 Mega Projects

  • New or expansion projects of the textile sector with investments of Rs. 100 crore or generation of employment for at least 250 in any Taluka will be granted the status and incentives of a mega project under the Industries Department’s Packaged Scheme of Incentives.
  • Status and Incentives of mega projects shall also be applicable to combined investment or employment generated by various units of the same entity of the textile sector, set up in the same Taluka.

6.8 Electricity Concessions

  • Cross subsidy on open access will not be levied for textile units.
  • The State Government’s Energy Department will not levy charges other than “transmission charges” on projects using non-conventional sources (solar, wind, etc.) of energy.
  • A subsidy of Rs. 3 per unit will be given to co-operative spinning mills for a period of 3 years. Within this period of 3 years the units will set up non-conventional power projects to fulfil their power needs. The restriction of 1 MW is removed from the net metering scheme. The subsidy of Rs. 3 per unit will not be applicable to open access. The subsidy will be reviewed every year and will be reduced to keep the overall annual subsidy burden within Rs. 150 crore.
  • A subsidy of Rs. 2 per unit will be given to powerlooms using power above 200 HP.
  • Subsidy given to powerloom units using less than 27 HP, 27 to 200 HP and more than 200 HP, will similarly be applicable to garment, knitting and hosiery units.
  • A subsidy of Rs 2 per unit will be given to spinning mills (except co-operative spinning mills), processing units and all other textile units which are using more than 107 HP power.
  • It is observed that the electricity rates for units using upto 27 HP are more than the rates applicable for units using 27 to 107 HP. Necessary action will be taken to eliminate this disparity.
  • When any unit is simultaneously using conventional and non-conventional power, the use of both the power sources will be taken into consideration to decide the load factor.
  • A committee comprising the Director General, Maharashtra Energy Development Agency (MEDA) and the Director Textile will be set up to finalise the subsidy required for setting up of co-operative spinning mills on solar power within three years.

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