The recent spurt in cotton prices has resulted in higher input costs for the spinning sector in the country leading to some financial stress.
Accordingly, the Ministry of Textiles has directed the Cotton Corporation of India (CCI) to sell its existing stock purchased under the Minimum Support Price (MSP) to spinning mills in the Micro, Small & Medium Enterprises (MSME) category only. CCI has commenced the e-auction sale of its balance unsold stock with effect from August 2 to the SSI units registered with the Office of the Textile Commissioner and the Government co-operative mills which are fully dependent on them for their cotton requirements.
This information was recently given by the Minister of State for Textiles, Mr. Ajay Tamta, in the Lok Sabha.
The financial assistance provided to textile units under the Technology Upgradation Fund Scheme (TUFS) by way of interest reimbursement/capital subsidy is marginal as compared to the loan amount received by them from banks.
Under the Modified Technology Upgradation Fund Scheme (M-TUFS), subsidy has been released upto the quarter ending March 2016. Under the Revised Technology Upgradation Fund Scheme (R-TUFS) and the Revised Restructured Technology Upgradation Fund Scheme (RR-TUFS) subsidy has been released upto the quarter ending December, 2015. In order to ease the situation, CCI has started selling stock to SSI spinning mills.