Government Approves PLI Scheme For Textiles

Trade & Policy

Government Approves PLI Scheme For Textiles

The Indian government has approved the PLI Scheme for Textiles for MMF apparel, MMF fabrics and 10 segments/ products of technical textiles with a budgetary outlay of Rs 10,683 crore. PLI for Textiles along with RoSCTL, RoDTEP and other measures of the government in the sector e.g. providing raw material at competitive prices, skill development, etc will herald a new age in textiles manufacturing. PLI scheme for Textiles will promote production of high value MMF fabric, garments and technical textiles in the country. The incentive structure has been so formulated that industry will be encouraged to invest in fresh capacities in these segments. This will give a major push to growing high value MMF segment which will complement the efforts of cotton and other natural fibre-based textiles industry in generating new opportunities for employment and trade, resultantly helping India regain its historical dominant status in global textiles trade. There are two types of investment possible with different set of incentive structures. Any person, (which includes firm / company) willing to invest minimum Rs 300 crore in plant, machinery, equipment and civil works (excluding land and administrative building cost) to produce products of notified lines (MMF fabrics, garments) and products of technical textiles, shall be eligible to apply for participation in first part of the scheme. In the second part any person, (which includes firm / company) willing to invest minimum Rs 100 crore shall be eligible to apply for participation in this part of the scheme. In addition, priority will be given for investment in Aspirational Districts, Tier 3, Tier 4 towns, and rural areas. Due to this priority, industry will be incentivised to move to backward areas. This scheme will especially positively impact states like Gujarat, UP, Maharashtra, Tamil Nadu, Punjab, AP, Telangana, Odisha, etc. It is estimated that over the period of five years, the PLI Scheme for Textiles will lead to fresh investment of more than Rs 19,000 crore, cumulative turnover of over Rs 3 lakh crore will be achieved under this scheme and, will create additional employment opportunities of more than 7.5 lakh jobs in this sector and several lakhs more for supporting activities. The textiles industry predominantly employs women, therefore, the scheme will empower women and increase their participation in formal economy. PLI scheme for Textiles is part of the overall announcement of PLI Schemes for 13 sectors made earlier during the Union Budget 2021-22, with an outlay of Rs 1.97 lakh crore. With the announcement of PLI Schemes for 13 sectors, minimum production in India is expected to be around Rs 37.5 lakh crore over five years and minimum expected employment over five years is nearly 1 crore jobs. According to Mr Prabhu Dhamodharan, Convenor, Indian Texpreneurs Federation (ITF), “PLI scheme for the textile sector will help the industry to build scale, competitiveness and specialisation.” He further stated, “India needs to build a strong fabric manufacturing eco system to grow our apparel exports. Apart from appare, MMF fabrics are also added as part of the PLI scheme and this move will help the industry to invest and build large scale capacities.” He informed that ITF has started working with potential members to study and explore the scheme.