The Gujarat government on Tuesday launched the highly-anticipated Gujarat Textile Policy 2024, which includes a range of benefits, including substantial subsidies on capital and power tariffs, along with comprehensive support schemes particularly aimed at MSMEs.
Marking a significant progression from the policies of 2012 and 2019, this new policy, for the first time, provides subsidies between 10% and 35% on eligible Fixed Capital Investment (eFCI), with a cap of Rs 100 crore.
Additionally, depending on the taluka category and activity, it offers credit-linked interest subsidies of 5-7% on eFCI for a period of five to eight years, with a maximum of 2% to 3% of eFCI yearly.
After introducing the policy, Chief Minister Bhupendra Patel stated, “Gujarat has long been a powerhouse in textile production, earning the titles of Textile State of India and Denim Capital of India. The Gujarat Textile Policy 2024 is a progressive step toward further empowering the industry, ensuring Gujarat remains a global leader while promoting economic opportunities for women and youth. This policy lays the foundation for a sustainable and competitive textile sector.”
Experts in the sector praised the strategy as “bold and comprehensive,” noting that it will provide the sector with a competitive edge, draw fresh investment, assist MSMEs in growing their businesses, and encourage innovation.
The Gujarat Textile Policy 2024 intends to provide monthly payroll support of Rs 2,000 to Rs 3,000 for male workers and Rs 3,000 to Rs 5,000 for female workers in an effort to further reduce operating expenses of units. The policy offers payroll aid for every worker up to 25% of their job work value turnover limited to Rs 5,000 a month for five years, as well as training assistance of Rs 5,000 each per month for three months, with the goal of encouraging skill development and upskilling of workers under self-help groups.
An industry that uses renewable energy through open-access or distribution businesses (discoms) for five years after the date of commencement of production (DoCP) will benefit from another initiative for the state: a tariff subsidy of Re 1 per unit (kWh).
In addition, the initiative provides help for technology acquisition, energy and water conservation, and quality certification. It consists of increased fiscal subsidies specifically designed for labour-intensive businesses, with extra rewards for companies that employ 4,000 or more people.
The policy expands its scope to include industries such as weaving, knitting, dyeing, texturising, twisting, and the manufacturing of yarn from polyester staple fibre (PSF) and viscose staple fibre (VSF) while keeping out cotton and synthetic filament yarn spinning.
It goes beyond the realm of apparel, garments, and technical textiles. These labour-intensive industries are anticipated to gain the most from the increased incentives in the form of lower electricity rates, payroll support, and capital and interest subsidies.
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