Subsidy for Textile Units

In India, the textile industry is the second largest industry after agriculture in terms of employment generation and economic contribution. In an attempt to enhance the growth of textile sectors in the State, the Government of Maharashtra has proposed to provide power subsidy for the textiles units of Maharashtra. This article explains the procedure for availing subsidy for textile units in detail.

Objectives

The objectives of providing power subsidy under New Textile Policy are as follows:

To generate new employment opportunities in the textile sector.
To increase the share of exports in the textile sector and make it more competitive.
To build an internationally competitive textile industry in the State of Maharashtra.

Also, read about North East Region Textile Promotion Scheme (NERTPS)

Eligibility Criteria

The following are the eligibility criteria required to obtain subsidy under the scheme:

The units having textile unit registration certificate are eligible to apply for the scheme.
The subsidy provided under the scheme applies only to the new enterprise.

Subsidy for Textile Units

A subsidy of Rs.3 per unit will be provided to co-operative spinning mills for three years. In these three years, the units are required to set up non- conventional power projects to satisfy their power needs. The restriction of 1MW is removed from the net metering scheme. The subsidy fo Rs.3 per unit will be renewed every year and will be reduced to maintain the overall annual subsidy of state budget within Rs.150 crores.
A subsidy amount of Rs.2 per unit will be provided to powerlooms using power above 200 HP. The subsidy is given to powerloom units using less than 27 HP, 27 to 200 HP and more than 200 HP, will also be applicable to garment, knitting and hosiery units.
A subsidy amount of Rs.2 per unit will be provided to spinning mills except for processing units, co-operative spinning mills and all other textile units using more than 107 HP power.

Note: It is observed that the electricity rates for units using up to 27 HP are more than the applicable rates for units using 27 to 107 HP. In order to eliminate this disparity, the necessary steps will be taken. To know the procedure for starting a Garment Business click here.

Power Subsidy Rate for Textiles Units

The State Government will provide the following subsidy to the eligible textile units of the State. The power subsidy will be provided as the rate per loom, which varies for General, SC and ST Category.

S.No.	Type of Modernization (subsidy rate per loom)	General Category (35%)	Scheduled Caste (SC) (20%)	Scheduled Tribes (ST) (8%)
1	Type of Modernization (subsidy rate per loom)	Rs.10,000	Rs.6,800	Rs.2,400
2	Simple powerlooms to semi-automatic shuttle loom	Rs.17,500	Rs.10,000	Rs.4,000
3	Semi-automatic shuttle loom to shuttle less rapier loom	Rs.28,000	Rs.16,000	Rs.6,400

Note: This scheme will be implemented as per the terms and conditions of the Central Government scheme. The policy of sanctioning financial credit will be performed after the receipt of beneficiary details from the Central Government is processed. If the scheme is updated by the Central Government, then the State Government will also modify the scheme respectively.