Textile industry wants quick TUFS disbursement

New Delhi: The textile industry has petitioned the Centre on alleged delays in disbursement of the interest component under the Technology Upgradation Fund Scheme (TUFS) during the last fiscal.

The Confederation of Indian Textile Industry (CITI), the largest textile industry body, has claimed that there is an estimated backlog of over Rs 200 crore pending for disbursement against claims filed during last year.

In a letter addressed to the Textiles Secretary, the CITI Chairman, Mr Hiren Shah, said a large number of claims relating to the October-December period last year were still pending with nodal agencies, while in the case of the January-March 2006 quarter, hardly any disbursements has been carried out.

'According to nodal agencies and lending institutions, disbursements are getting delayed because they have not been able to get funds from the Ministry of Textiles. The upfront capital subsidy of 10 per cent announced for specified processing machines has also not actually taken off because of the non-availability of funds,' Mr Shah said.

CITI said that even as the Ministry of Finance had hiked fund allocation for TUFS for 2006-07 to Rs 535 crore from Rs 435 crore the previous year, after clearing the backlog of over Rs 200 crore, the funds available for the current year would be less than Rs 335 crore.

'This will not meet even half the requirements for the year. This will mean that even after releasing all the available amount to the lending agencies, we run the risk of exhausting the funds by August-September this year,' it said.