India expects investment in its textile sector of Rs 330 billion during the current fiscal year, compared to Rs 219 billion the year before, a textile ministry statement said on Wednesday.
About Rs 250 billion of that would be channeled through the government-funded textile modernisation fund, Textile Minister Shankersinh Vaghela said.
The main feature of the Technology Upgradation Fund Scheme (TUFS) is a 5 per cent reimbursement of interest to financial institutions which lend under the scheme. It also offers capital- linked credit subsidies to the textile industry.
The government had earlier said it expected to double its fund disbursement under TUFS to Rs 300 billion in 2006/07 from 150 billion rupees in 2005/06.
India's textile and clothing industry contributes about 14 per cent to industrial production, and about 17 per cent to the country's total exports. It directly employs over 35 million people and another 50 million work in allied activities.
India's textile export target for the current fiscal year is $19.7 billion--of which $4.6 billion was recorded in the April-June quarter--compared to $17 billion last year.
The European Union is the largest market accounting for 35 per cent of textile exports, followed by the US at 27 per cent, the statement said.
India's National Textile Policy 2000 has set a target of $50 billion of annual textile exports by 2010. By when, the statement added, the sector aimed to attract investment totalling Rs 1.4 trillion.