Outlays under the Amended Technology Upgradation Funds Scheme (ATUFS) have been reduced in the Interim Budget. Over 3000 projects that got implemented are yet to receive subsidies. The ATUFS is the lifeline of the textile sector. With just Rs 700 crores being allocated under the scheme, modernization in the textile industry is expected to be affected. Power loom weavers who have to repay loan instalments fear a difficult situation.

At least 1500 power loom weavers in Surat, , have filed for the 10 per cent subsidy under the ATUFS. These weavers had ordered machinery from foreign countries for obtaining the benefit of the subsidy. But the complicated guidelines of ATUFS have resulted in non-reimbursement of the subsidy amount to the weavers. India’s largest manmade fabric textile industry is in Surat.

Out of the 7000 files submitted for subsidy under ATUFS, only 70 have been approved for disbursal across the country. Textile players face severe difficulties while availing of benefits under the ATUFS. The total fund allocation under ATUFS has been very low since its launch in January 2016. The complicated structure of ATUFS has made it one of India’s least preferred subsidy schemes. For example, overseas machinery suppliers have to be enlisted in the suppliers’ list.