Ministry of Textiles (MoT) is re-considering the products shortlisted so far for qualification under the production-linked incentive (PLI) scheme.
MoT is looking at including inputs such as fabrics and filaments in both the man-made fibre (MMF) and technical textiles categories to incentivise more value addition in the country.
As per a report of English daily BusinessLine, MoT is also taking a re-look at the condition of achieving 50 per cent growth on a year-to-year basis as the industry pointed out that is ambitious and difficult to achieve.
As of now mostly end products have been considered for the PLI scheme of worth Rs. 10,683 crore both for the MMF and technical textiles categories like apparels, sweaters, diapers and sanitary napkins. It will be offered for incremental production in 40 identified man-made fibre items and 10 technical textiles products over five years.
The textile industry and experts strongly feel that just including end products may not optimally encourage manufacturing and investments. It is also important to include inputs such as fabrics and filaments used for making the end product to give a boost to investments and production.
There is also a demand from the industry to lower the turnover threshold for eligibility under the scheme to include smaller players as well. As per the initial plans, for brownfield companies (companies already in operation) the incentive rates were, reportedly, proposed to be fixed at 9 per cent of turnover in the first year for companies with a turnover of Rs. 100-500 crore (for 50 per cent incremental turnover) and 7 per cent for those above that. In the subsequent four years it would keep decreasing.
The report quoting sources said that for greenfield projects (new set-ups), a minimum investment of Rs. 500 crore was, reportedly, proposed with incentives at 11 per cent to start with.
As per the official of MoT, the PLI scheme has to fit in with what the needs of the industry and the market conditions are. It is better for the Government to take some time and get it exactly right.
