The policy provides several fiscal incentives to promote investment and expansion in the textile sector.
The Gujarat government announced its new textile policy, which includes a range of subsidies and financial incentives for entrepreneurs interested in establishing units in the state.
At an event in Gandhinagar, Chief Minister Bhupendra Patel unveiled the ‘Gujarat Textile Policy 2024’ and expressed expectations of attracting an investment of Rs 300 billion in the textile sector.
The previous five-year textile policy, introduced in 2019, concluded this year.
The Chief Minister stated that the new policy is expected to play a crucial role in drawing significant investment into the textile sector. He highlighted that one of its goals is to transform Gujarat into a global hub for technical textiles and mentioned that provisions have been made to ensure higher incomes for women self-help groups (SHGs) involved in this sector.
According to an official release, the policy emphasises key areas such as garments, technical textiles, weaving, knitting, and the production of man-made fibres (MMF), particularly focusing on expanding technical textiles that are vital for industries like automotive, healthcare, and infrastructure.
The policy provides several fiscal incentives to promote investment and expansion in the textile sector. These incentives include a capital subsidy ranging from 10 per cent to 35 per cent of eligible fixed capital investment (eFCI), with a cap of Rs 1.50 billion based on factors such as location, activity, and employment.
Additionally, businesses can receive an interest subsidy between 5 per cent and 7 per cent of eFCI for a duration of up to eight years.
Other incentives encompass a power tariff subsidy of Rs 1 per unit for five years, payroll assistance of Rs 2,000 to Rs 5,000 per month per worker (with extra support for female employees), and targeted support for SHGs in the form of payroll and training assistance.
The policy also prioritizes employment generation by offering targeted support to labour-intensive units employing over 4,000 workers, including at least 1,000 female employees, which will qualify for enhanced subsidies.
Furthermore, the new policy advocates sustainability and innovation by encouraging investments in sustainable practices. Incentives are available for businesses focusing on water and energy conservation, quality certification, and the adoption of advanced technologies.
Under the PM MITRA initiative, a state-of-the-art textile park is set to be established in Vansi, Navsari district, with an investment of Rs 3.52 billion. This project aims to enhance Gujarat’s textile infrastructure, attract new investments, and create thousands of jobs.