Has anyone looked at the impact of the new textile policy on the capacity creation and volume growth in textile industry? Could have a significant impact on Stovec’s machine and/or consumable sales.
Following are the key points:
The government will provide additional 10% subsidy under Amended Technology Upgraded Funds Scheme (ATUFS) to garment players (25% ATUFS subsidy for as against earlier subsidy of 15%) for next three years. It expects additional outgo of funds of Rs 4-5 bn per year.
The government will provide additional 5% duty drawback on garment exports for next three years
(total ~ 12% duty drawbacks to garment exporters as compared to ~7% earlier). It expects additional outgo of Rs 55 bn per year.
Government shall bear the entire 12% of the employers’ contribution of the Employers Provident Fund Scheme (against 8.33% earlier) for new employees of garment industry for first 3 years who are earning less than Rs 15,000/month. It has made employees contribution to EPF optional for employees
earning less than Rs 15,000 per month.
Minimum number of working days for regular employees reduced to 150 days for Garments manufacturers.
The government has allowed maximum overtime of 8 hours/week for workers involved in garment manufacturing against 4 hours/week earlier. Introduced fixed term employment for the garment sector. A fixed term workman will be considered at par with permanent workman in terms of working
hours, wages, allowance and other statutory dues.