Companies entering textile space may get highest benefit under PLI


New Delhi: The government may introduce a category called ‘Greenfield’ in the recently announced production-linked incentive (PLI) scheme for textiles to encourage companies to venture into the sector.

As per the discussions, to be eligible for the scheme, the new entrants would be required to invest at least ₹500 crore for which the initial benefit is likely to be 11%, which is the highest of all categories being discussed.



Incentive rate for existing companies in the sector could be 9% of their incremental production in the first year for companies with turnover between ₹100-500 crore, which would be tapered gradually to 5%. Companies with turnover of above ₹500 crore would be eligible for a 7% incentive rate, which would be reduced to 3% eventually.

The scheme aims to create 50-60 world class global champion companies in these segments.

“We are looking at high potential products and those that are traded the most globally,” an official said. “It is only at a proposal stage, but we want new products that can be produced and exported from India to get the incentive.”

Airbags, sutures, sanitary napkins and bandages could be among 10 products in

to get a manufacturing boost under the scheme along with another 40 items of man-made fibre (MMF) such as track suits, coats and babies’ garments.

Cos Entering Textile Space may Get Highest Benefit Under PLI

The cabinet had approved a ₹10,683-crore PLI scheme for man-made fibres and technical textiles last year. The government has also undertaken a ₹1,480-crore National Technical Textiles Mission to improve penetration level of technical textiles in the country, which has a four-year implementation period – from 2020-21 to 2023-24.

India has 207 items in technical textiles and HSN codes (tariff codes) up to eight digits and the government has ensured that 92 technical textile items used in areas such as agriculture, healthcare, hygiene, water resources, and building of roads and highways, are mandated and made compulsory for use.

Of the 207 items, 12 products come under the apparel category. The global market for these 12 products is estimated at $11 billion a year, but India’s exports in this segment are only $93 million.

“Our share in global MMF exports is currently 2.8% and these products are high value products, mainly winter wear,” said an industry representative who requested not to be identified. “The industry is keen to capture this new and growing market.”

While global exports in 40 MMF identified lines is $140 billion, India’s share is less than 1%.





Source link