The technology modernisation subsidy for the textile sector would continue in the twelfth Plan with an enhanced allocation of 15,886 crore rupees.Talking to newsmen in New Delhi Commerce and Textile Minister Anand Sharma said,government is also working on a package for powerloom and silk sectors.

The outlay for Technology Upgradation Fund Scheme, TUFS, in the eleventh Plan was 12,000 crore rupees. Under the scheme, government provides subsidies to the industry for modernisation by installing new machinery and adopting upgraded technology. The scheme is very popular among textiles segments such as spinning, cotton ginning and pressing, garments and weaving.
Our correspondent reports,the industry has been hit by high raw material prices, high interest rates, besides demand slowdown in major markets such as Europe and the US.The government had announced a 35,000-crore rupee debt restructuring package for the ailing textile industry, which has been faced with massive unemployment and shutdown of business.

The Centre has agreed for a 35000 crore rupee debt restructuring package for the textile sector. Following his meeting with Finance Minister Pranab Mukherjee last evening, the Textiles Minister Anand Sharma announced that the Government has agreed that there is a need to support the Textiles industry in this time of crisis. The Textiles Minister said that the total outstanding debt of textiles sector is Rs. 155,809 crores of which debt of Rs. 35000 crores needs restructuring. He said, Government directions to banks to consider this on priority would be issued in this regard. Textiles Minister Anand Sharma said that there was agreement with the Ministry of Finance that the debt restructuring package would be considered on a case to case basis by Individual Banks.  The Finance ministry would examine in consultation with Reserve Bank of India for a 2 year moratorium on term loans, special provision in NPA norms to avoid asset reclassification and working capital eroded to be converted into working capital term loans repayable over a period of 3-5 years.  An inter-ministerial committee of senior officials would also be constituted to coordinate with Industry-Banks in expeditious restructuring.  The Union Minister of Commerce, Industry and Textiles Shri Anand Sharma had met Finance Minister Shri Pranab Mukherjee, and urged for loan restructuring for the debt stressed textiles industry. Textiles Industry Associations had represented to the textile minister of high stress levels and industry sickness and sought his intervention for a restructuring package. Industry associations had sought a 2 year moratorium on long term loans, special dispensation to be provided by Reserve Bank of India in its NPA rules working capital term loans.