Gujarat Govt announces new Textile Policy

GANDHINAGAR : The Government of Gujarat announced its new Textile Policy, in which 10 to 35 percent capital subsidy is provisioned. In contrast to the previous policy, which offered a 5% to 6% interest subsidy, the new policy has provisions for a 5 to 7% subsidy. Additionally, a power subsidy of Re. 1 per unit has been introduced.

The new policy was launched by Chief Minister of Gujarat, Shri Bhupendra Patel, during the Udyog Saahasikta Divas celebration, underscoring the state’s commitment to making the textile industry more competitive, sustainable, and employment-generating.

The policy focuses on key sectors such as garments, technical textiles, weaving, knitting, and MMF production, with a special emphasis on expanding technical textiles, which are essential for industries like automotive, healthcare, and infrastructure.

It offers several fiscal incentives to encourage investment and expansion in the textile sector. These include a Capital Subsidy ranging from 10% to 35% of eligible fixed capital investment (eFCI), capped at ₹150 crore depending on location, activity and employment. Additionally, an Interest Subsidy of 5% to 7% of eFCI is available for up to 8 years. Other incentives include a  Power Tariff Subsidy of ₹1/unit for five years, Payroll Assistance of ₹2,000 to ₹5,000 per month per worker (with additional support for female workers), and dedicated Support for Self-Help Groups (SHGs) in the form of payroll and training assistance.

The policy emphasizes  employment generation, providing targeted support to labor-intensive units that employ over 4,000 workers, including at least 1,000 female employees. Such units will receive enhanced subsidies.