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2 Mar, 2013

India’s Handloom Weaver Loans at Low Rate “to be a Game Changer”


Ministry of Textiles, 01-March, 2013 – The Union Minister for Commerce, Industry & Textiles Mr Anand Sharma has welcomed the announcements made by the Finance Minister on textiles sector in his Budget Speech yesterday.

Mr Sharma, while delivering the keynote address during the one-day conference on National Consultation on Handloom sector, here today said that the announcement for providing fresh working capital and term loans to our weavers at a substantially low rate of only 6 per cent from the earlier high rate of 14 per cent without interest subvention or 11 per cent with 3 per cent interest subvention will benefit 1.5 lakh individual weavers and 1800 primary cooperatives. “This is perhaps for the first time that such a big policy roll out in sync with the demands of this community has been announced by any Government and I am confident that this single policy initiative of the UPA Government will become a game changer for this sector,” said Mr Sharma. “Our aim was to bring this at par with Khadi and we have done this.”

The Minister said that the Textiles Ministry is in the process of making a paradigm shift in how it defines the Handloom Sector, without compromising on its core strength of being a hand woven sector. “After intense stakeholder consultations, we, under the Handloom Reservation of Articles for Production Act, 1985, propose to include hybrid looms where one of the three primary motions of shedding, picking and beating can be mechanical,” said Mr Sharma. He expressed the hope that this will greatly facilitate the weavers as this will not only be in sync with ground realities but also substantially reduce the drudgery associated with weaving. He clarified that this would be done without a conflict of interest with the hand woven technique, which is the exclusive domain of this sector and also its core strength.

Mr Sharma also proposed a new Comprehensive Integrated Handloom Cluster Scheme for 5000 plus handlooms to complete the missing link in terms of providing infrastructure support to the handloom sector. He also proposed that the facility of making available at subsidised rates cotton and silk yarn under the 10% price subsidy scheme for which a provision of Rs 1300 crores has been made in the Financial Package through the agency of the National Handloom Development Corporation (NHDC), will now be extended to other fibres like jute, wool and coir. “This will greatly benefit the large but scattered concentration of looms and weavers in the North East Region as there is also a 2.5 per cent transport subsidy available under this Package,” said Mr Sharma.

Mr Sharma further highlighted that in order to extend the outreach of the Handloom Package to cover more cooperative societies, “the Ministry has proposed certain amendments as demanded by a large number of States, whose Chief Ministers have written to me to relax the net worth and norms for potentially viable societies,” said Mr Sharma.

Commenting on the issue of the issuance of Weavers Credit Cards, Mr Sharma said that the Ministry, in a meeting with the CMDs of major nationalised banks, has conveyed them that no stones should be left unturned in making credit available to the weavers through a single window mechanism without undue hassle of filling up too many forms or making repeated visits to the banks. Minister promised the weavers to review it on a fortnightly basis.

Mr Sharma also showcased the steps taken by the Government in making exports from this sector competitive in the international market. “To promote exports, several fiscal incentives and interventions have been provided under the Foreign Trade Policy. Kanoor in Kerala, Karur and Madurai in Tamil Nadu and Khekra in UP have been designated as Towns of Export Excellence. Moreover, 2 per cent Interest Subvention under the Focus Product Scheme has been extended to the Handloom Sector till March, 2014, to arrest decline in its exports which fell by -11% last year. The Budget has also exempted hand woven carpets from excise duty,” said Mr Sharma.