The Finance Minister, Mr. P. Chidambaram, did spring a surprise by presenting the Central Budget for 2013-14 which far exceeded the expectations of the ailing textile industry with a series of progressive measures for its speedy revival. Termed a positive package for accelerating the textile industry recovery, signs of which are amply evident in its performance since last few months, the Budget has, as expected, had its special thrust on the hitherto-neglected weaving sector. The special allotment of Rs. 2,400 crores for modernisation of powerlooms and the provision of fresh working capital and term loans to the handloom sector at a substantially low rate of six per cent to benefit 1.5 lakh individual weavers and 1,800 primary co-operatives represent perhaps the first positive gesture by the UPA Government to improve the fortunes of the weaving community. A big boost to the apparel industry is assured by providing Rs. 50 crores to the Textile Ministry to facilitate setting up of apparel parks within the integrated textile parks. Again, for the first time, a Rs. 500-crore Integrated Processing Development Scheme has been initiated to address the environmental concerns of the textile industry as a whole.
The proposal to continue the Technology Upgradation Fund Scheme (TUFS) in the 12th Plan with an investment target of Rs. 1,50,000 crores and an allocation of Rs. 2,400 crores for 2013-14 would go a long way in modernising and updating the technology of textile units which have their renewed focus on technical textiles. Similarly, a cut in customs duty from 7.5 per cent to five per cent on textile machinery would help augment investments in the sector. Handmade carpets and textile floor coverings are now totally exempt from excise duty.
There is high optimism on the export front too, with the Budget objective of helping the textile industry retain its status as the largest exchange earner for the country. Textile and clothing exports moved up from $22.41 billion in 2009-10 to $33.31 billion the next year. However a slight setback in exports was noticed in April-January 2013 due mainly to the slowdown in the traditional markets of the US and the EU, which together account for almost 60 per cent of India’s textile exports. Now Union Commerce Department sources confirm that overall exports from India to the two regions in the last 12 months are evidently on a recovery path, implying thereby the scope to vastly improve the individual share of textile exports.