Cottage Industry

10.
2 Village and Small Industries 599

10.2 VILLAGE AND SMALL INDUSTRIES
Introduction
Small-scale and cottage industries play a very vital role in the country's
economy despite the phenomenal growth in the large-scale sector. In fact,
the small-scale sector is playing a vital role in the growth of national
economies the world over and is considered to be the engine of growth in
most countries. The small-scale industries are labour - intensive and provide
employment to nearly 1.86 crores persons in the country.
The emphasis on Village and Small-Scale Industries (SSIs) has always
been an integral part of the Indian Industrial strategy, more so after the
Second Five Year Plan. It was envisaged that Village and Small-Scale
Industries would play an important role as producer of consumer goods and
absorber of surplus labour thereby addressing to the problems of poverty and
unemployment. Other advantages of small industries are that they ensure a
more equitable distribution of national income, enhance balanced regional
industrial development, act as a nursery for entrepreneurship and facilitate
mobilization of local resources and skills which might otherwise remain
unutilized. Consequently, the Government of India had been encouraging
and supporting the promotion of Small-Scale Industries through deliberate
policies such as protection from large-scale industries, capital subsidies,
differential tax treatment, reservation etc.
The Government continues to provide protection to the small scale
sector, inter-alia, through the policy of reserving items for exclusive
manufacture in the small-scale sector. Industrial undertakings other than the
small-scale industrial undertakings engaged in the manufacture of items
reserved for exclusive manufacture in the small-scale sector are required to
obtain an industrial licence and undertake an export obligation of 50 per cent
of the annual production. However, the condition of licensing is not applicable
to such industrial undertakings operating under 100 per cent Export Oriented
Undertakings Scheme, the Export Processing Zone and the Special Economic
Zone Schemes.
The reservation policy was introduced in 1967 an attempt to protect
SMEs from competition from corporations and 44 goods were specified to be
exclusively manufactured by SMEs (Large Corporations were allowed to enter
this sector on condition that 50% of their produce would be exported). As a
result, SMEs dominated readymade garments, leather goods, autocomponents,
electrical appliances and the hand tool industries. Over the
years, the number of items reserved for SMEs increased and it stood at over
800 in 1989. However, the Abid Hussain Committee set up by the
Government of India which submitted its report in January 1997 observed that
the reservation policy was inconsistent with the current trade reforms which
allow free import of a large majority of the goods and most of the remaining
can be imported under the special Import Licence. The number of reserved
items has, therefore, been coming down.
Industrial undertakings with investment in plant and machinery up to
Re. 1 crore qualify for the status as small-scale or ancillary industrial
10.2 Village and Small Industries 600
undertaking with effect from 24 December 1999. The investment limit for tiny
units is Rs. 25 lakh.
The Small-Scale Industry sector has emerged as a dynamic and
vibrant sector of the Indian economy in recent years, displaying phenomenal
growth in the field of production, employment and dispersed development in
general and exports in particular. There are nearly 34 lakhs Small-Scale
Industries in the county accounting for about 40% of the gross value of output
in the manufacturing sector and about 34% of the total exports of the country.
It provides employment to nearly 186 lakhs persons, which is second only to
agriculture.
The Small-Scale sector contributes amply to other socio-economic
aspects such as reduction in income inequalities, product diversification,
dispersed development of small industries and linkage with other sectors of
the economy.
Tamil Nadu Small Scale Industries – Profile
The small scale industries, which are defined in terms of value of
productive machinery, made an early start in Tamil Nadu with the Government
stepping in to create major industrial estates at Guindy and Ambattur in
Chennai. In 1973, Tamil Nadu had the largest number of SSIs in the country
with 18,500 registered units and it has maintained this leadership, by and
large. When the Second All India Census of SSIs was carried out in 1987-88,
it was still the leader in terms of units and employment, though not in the
growth rate.
According to SIDBI (2000), in its Report on small-scale industries
sector during 1988-89 to 1998-99, the Tamil Nadu SSI sector continued to
grow fast. The average annual rate of growth (compound) of number of units
was 12.8 per cent and of employment 10.9 per cent.
As an important sector of the economy as a whole, Small Scale
Industries sector accounts for 95 per cent of industrial units, 40 per cent of
output in manufacturing sector, 35 per cent of exports and employment to 30
lakhs persons in the State. There are nearly 4.20 lakhs registered SSI Units
and total investment nearly Rs. 12,500 crores. The contribution of Small
Scale Industries to employment generation is next only to Agricultural and
allied sectors. The SSI sector has been considered as a powerful instrument
for realizing the twin objectives: `Accelerated Industrial Growth' and creating
additional `Productive Employment Potential', in rural and backward areas.
Position as in 2000-2001
No. of Small-Scale Industries Units Rs. 33.70 lakhs
Production at current prices Rs. 6,45,496 crores
Employment 186 lakh persons
Exports Rs. 59,978 crores
The Government departments/ agencies concerned with Small
Industries comprise the Small Industries Department at the Secretariat, the
Directorate of Industries and Commerce, the Tamil Nadu Small Industries
Development Corporation (SIDCO) with 73 Small Industrial Estates, the Tamil
Nadu Small Industries Corporation (TANSI) with 26 production units, the
Entrepreneur Development Institute and INCOSERVE, SAGOSERVE, TAICO
Bank and Industrial Co-operatives.
The Village and Small Industries Sector comprises of five Sub-Sectors
viz., 1) Small Scale Industries (under the control of the Director of Industries
and Commerce), 2) Handlooms and Textiles, 3) Khadi and Village Industries,
4) Handicrafts Development and 5) Sericulture.
Ninth Plan Outlay - As against an outlay of Rs. 600 crores for Village
and Small Industries in the Ninth Plan, the expenditure has been Rs. 385.45
crores.
The departmentwise activities and performance during the Ninth Plan
and the programs for Tenth Plan are outlined below:
Small Industries - State Profile
No.of registered SSI Units 4.20 lakhs
Employment 30 lakhs
Total investment Rs. 12500 crores
Production Rs. 21537 crores
Predominant Industries - Textile, Food Products,
- Non-Electrical machineries, tools and
parts,
- Cotton Textile
- Paper and Printing.
Major Exports - Readymade Garments
- Leather & leather goods
- Gem and Jewellery, Cashew Kernal
- Food products, Marine products.
Major issues - Need for modernisation and
technological upgrdation,
- Strengthening the system of
information dissemination,
- Need for availability of working capital
- Need for infrastructure building
I. Small Scale Industries
Directorate of Industries and Commerce - The Directorate of
Industries and Commerce is the nodal agency for planning and implementing
various schemes for the promotion of Small Scale Industries in Tamil Nadu. It
provides various services through the District Industries Centres such as
registration of SSIs, training of entrepreneurs, Industrial guidance, promotes
Village and Small Industries by organising Industrial Co-operatives
(particularly for match, tea & coir industries) and identifies and promotes
craftsmen and artisans engaged in the handicrafts industry.
The Department of Industries and Commerce also implements a
variety of programmes to provide financial assistance, technical support and
guidance service to the existing as well as new industries. These programmes
are implemented with an accent on the development and modernisation of
industries, up-gradation of technology and quality control. It operates through
a network of District Industries Centres (DICs), one in each district, headed by
a General Manager.
The various activities undertaken by the Department include:
1. Registration and promotion of small scale and tiny industries and
industrial Co-operative societies.
2. Sanction and disbursement of various subsidies and incentives such
as State Capital Subsidy, Generator Subsidy, Power Tariff Subsidy.
3. Offering various testing facilities for chemicals, metals, metallurgical,
electrical, electronic gadgets and appliances.
4. Implementation of centrally sponsored schemes like Self Employment
Programmes for the Educated Unemployed Youth and Prime Minister’s
Rozgar Yojana schemes.
5. Conducting Entrepreneur Development Programmes particularly
special schemes for women.
6. Creating awareness about the various policies and programmes of the
Government through seminars and dissemination meets.
7. Providing Escort Services to the Entrepreneurs.
8. Maintenance of Special purpose Industrial Estates for Electrical and
Electronics Industries.
9. Providing entrepreneurial guidance through Data Bank and Information
Centre and technical information sections attached to various District
Industries Centres.
10. Identification of new areas with growth potential and providing
familiarisation and Incubator facilities to promising entrepreneurs.
11. Conducting Techno-Economic Surveys.
12. Conducting sample and comprehensive surveys.
13. Development and promotion of cottage and handicrafts industries.
14. Training facilities in the field of light engineering, tool and die designing.
15. Assistance for import of capital goods machineries and scarce raw
materials.
16. Implementation of Quality Control Act on Electrical household
appliances, etc.
17. Export Promotion.
18. Supervision of implementation of special assistance schemes
announced by Government in favour of small and tiny sector units.
The entrepreneurs are assisted in getting statutory clearances from
Local Bodies, Town Planning, Pollution Control Board, Public Health,
Factories and other Departments and getting power connections through the
Single Window Committee. The District Single Window Committee has been
formed with District Collector as its Chairman. A State Level Committee
under the Chairmanship of the Chief Secretary to Government periodically
reviews the functioning of the District Window Committees in the State.
In order to promote Tiny and Rural Industries, 287 Blocks in the State
have been declared as Industrially Backward/ Most Backward. Small Scale
Industries (SSIs) located therein are eligible for grant of State capital subsidy,
Low Tension Power Tariff (L.T.P.T.) subsidy and other concessions. These
incentives and concessions are also available to the units located in the
Industrial Estates and Industrial Complexes sponsored by Government/
Government Agencies.
An outlay of Rs. 200 crore was provided for the Small Scale Industries
including Industrial Estates during the Ninth Five Year Plan (1997-2002) of
which the expenditure incurred was Rs. 123.95 crores. (61.98%).
The details of permanent registration, investment, production in terms
of value and employment generated during the Ninth Plan period may be
seen from table below:
Details of Permanent Registration, Investment,
Production & Employment Generation
Ninth Plan Period
(Rs. in lakhs)
Sl.No.
Year
Permanent
Registered
Units in Nos.
Investment
Production
Employ-
ment
( in lakh
Nos.)
1. 31.3.1998 295004 796600 4867500 22.50
2. 31.3.1999 334627 935000 5843200 24.51
3. 31.3.2000 354939 1062300 7098700 26.67
4. 31.3.2001 387597 1156722 7826166 29.07
5. 31.3.2002 401691 1205073 8134242 30.12
Source: Department of Industries & Commerce
The target and achievements in respect of permanent registration and
temporary registration during the Ninth Five Year Plan (1997-2002) period
are furnished below:
Target and achievements of permanent and
provisional registration from 1997-2002
Permanent Provisional
Year Physical
target fixed by
Govt.
Physical
Achievement
Physical
target fixed
by Govt.
Physical
Achievement
1997-98 30000 31584 50000 59118
1998-99 30000 30039 50000 49880
1999-00 30000 30955 50000 48273
2000-01 33000 33023 50000 50623
2001-02
(Upto Sep’01) 33000 17285 50000 8255
Source: Department of Industries & Commerce
Prime Minister’s Rozgar Yojana Scheme - (PMRYS)
The Prime Minister’s Rozgar Yojana Scheme, (PMRYS) for the Educated
Unemployed Youth was launched by Government of India on 2nd October
1993 for encouraging educated unemployed youth to set up self-employment
ventures in Industries, Services, Business, etc. Under this scheme training is
provided in Government recognised/ approved institutions. During the Ninth
Plan Period as against the target of 90,500 persons to be trained, 68,525
persons were actually trained. A total number of 73,672 applications were
sanctioned for providing financial assistance to the tune of Rs. 380.84 crores of
which an amount of Rs. 297.21 crores was actually dispersed to 59,578
applicants. The subsidy is met entirely by the Government of India.
Small Scale Industrial Units
The details of new Small Scale Industries Units set up and registered,
SSI Units set up by SC/ ST Entrepreneurs registered during Ninth Plan period
are given in the table below:
New SSI units set up and
registered
New SSI Units set up by
SC/ST entrepreneurs
Registered
Year
Target fixed
by Govt.
Achieve-
ment
Target fixed
by Govt.
Achievement
1997-98 17020 18320 2000 2210
1998-99 17870 18682 2000 2171
1999-00 17500 18574 2000 2132
2000-01 17500 12538 2000 1305
2001-02
upto
Sep’01
17500 9921 2500 1414
Total 87390 78035 10500 9232
Tenth Plan
Thrust Areas
The following Thrust Areas have been identified for the development of
Small Scale Industries in the Tenth Plan.
1. Leather and Leather products
2. Textiles and Readymade Garments
3. Gems and Jewellery
4. Pharmaceuticals
5. Information Technology
6. Bio-Technology
7. Automobile Component
8. Food Processing
9. Coir Industries, etc.,
The feasible project opportunities, the green areas and suggestions in
respect of these industries are set out in the Table below:
Table
Thrust Areas for SSIs in Tenth Plan (Source: Directorate of Industries and Commerce)
Sl.
No.
Nature of SSI Feasible Project opportunities Green Areas/District/Places Suggestions
1.
Leather and
Leather Products
Footwear and Footwear
components, full shoes leather
chappals, shoe upper, Leather
Garments, Industrial Gloves,
Leather Caps and Leather
products like Leather wallet,
Ladies pouch, Leather Belts,
Leather Travel goods etc.
Vellore, Ambur,
Vaniyambadi, Erode,
Dindigul, Trichy, Chennai
(Pallavaram) are green
areas for Leather and
Leather products.
• Provide necessary infrastructure support / common Effluent
Treatment Plants, CAD/CAM centres with assistance of
Government aid.
• Common facility centre.
• Industrial Estates with the required facilities for leather
processing may be formed for Advance Training in Leather
Garments and Leather Goods.
• Upgradation of technology in the training sector to meet the
international environmental standards.
2.
Textile and Ready
Made Garments
Readymade Garments such as
T-Shirts, Ladies Blouse,
Jerseys, Trousers & Gent's
Shorts, Pull overs, Gent's
Shirts, Ladies Jackets,
Industrial and Occupational
Garments, Bath robes and
shorts, Children Garments etc.
Salem, Erode, Namakkal,
Coimbatore, Madurai,
Chennai Districts.
• Common Facility Centres for pre sewing and post sewing
operation may be started in the textile cluster of above districts.
• Fashion technology training may be provided in select districts.
• Trade Fairs/Buyer & Seller Meet to be conducted in the areas
mentioned above. The terms for availing technical up gradation
fund may be made.
3. Gem and Jewellery Natural Diamond cutting and
polishing, cultured pearls,
Jewellery design (Silver, Gold
and Platinum), Gold covering
on silver ornaments. Carving of
idols/art-shapes out of
precious/semi precious stones.
Pudukottai, Trichy, Salem,
Kumbakonam, Chennai,
Erode and Coimbatore.
• Encourage setting up of training centres to train and impart
courses of polishing, finishing and setting on par with
international standards for Natural diamond in private sector.
• Jewellery designing centre and training of manpower.
10.2 Village and Small Industries
607
4. Pharmaceutical Allopathy Medicine such as
bulk drugs, cancer drugs,
Vitamin Tabs, Ointments,
Ayurvedic Tooth
Powder.Homeopathic Medicine,
Neem paste, Tulasi extract,
Palm sugar, Herbal medicines
etc.
Chennai, Cuddalore,
Tuticorin, Madurai,
Dindigul, Tirunelveli,
Courtalam, Kumbam,
Vellore, Nagai,
Salem(Yercaud), Namakkal
(Kolli Hills), Dharmapuri.
• To create R & D and product Display Centre for Herbal
medicine for imparting knowledge and Training in EOUs.
5. Information
Technology
International call centre,
Domestic call centre, Medical
Transcription Centres, ECommerce,
Portal, Dataprocessing
centre,
CAD/CAM/CAE Service Centre
GIS service centre, ERP
Training Centre, Video
Conferencing Provider etc.
All Districts in Tamil Nadu,
especially District Head
Quarters and Taluk Head
Quarters.
• Creation of IT incubators at selected District Head quarters.
• To encourage SSI entrepreneurs as well as software
technology.
• To create incubators at selected District Head quarters to
encourage SSI entrepreneurs.
6. Biotechnology /Bio
Informatics
Hybrid Seeds, Tissue Culture,
Neem and other Bio-pesticides,
bio-fertilizers, botanical extract
for plant disease control, Food
and Industrial
Enzymes.(Pupain, Phytase,
Lipase, Enzyme cocktails etc.)
Classical fermentation products
(antibiotics, immuno modulators
etc.) Bio-energy, Surface and
additives, Bio-Polymers and
Bio-informatics.
• Bio-Tech Incubators
Park near Chennai,
Coimbatore.
• Women's Bio-
Technology Park,
Kelambakkam.
• Medicinal Plants Biotechnology
park near
Madurai.
• Marine Bio-Technology
Park at Mandapam,
Ramanad.
• Bio-Informatics and
Genomics Centre (BGC)
at TIDEL Park Chennai.
Starting of Bio-Technology incubator at Karaikudi.
• Creation of certain new short duration technician oriented
courses at appropriate Universities / Technical Training
Centres/ Associations in specific areas.
• Creating a Data Base for Biotechnology and Bio-informatics.
• Financing & Infrastructure support.
• Creation of Bio-technology incubator at Coimbatore and also
create a data-base for Bio-Informatics.
• Creation of industry-university interface.
608
7. Automobile
Components
Industry
Gears, Starter Motors,
Radiators, Spark plug, Fuel
pump elements, Shock
Absorbers, Piston Pairs, Piston
rings etc.
Chennai, Tiruvellore,
Kancheepuram, Hosur,
Madurai, Trichy,
Pudukkottai.
• To assist the SSI's towards Technology upgradation for
graduating them to medium Scale Industries.
8. Food Processing Dehydrated Vegetables & fruits,
fuel Briguettes fuels, Egg
Powdered Bakery, Sun dried
fruits and vegetables, Cold
storage, Confectionery, Iodized
salt fruit processing tamarind
pulp, tamarind concentrate,
spices and oleoresins, natural
juices, ready to eat.
Dharmapuri, Erode, Salem,
Coimbatore, Theni,
Usilampatti, Madurai,
Nagercoil, Tuticorin,
PUdukkottai, Chennai,
Cuddalore, Thanjavur,
Vellore,
Kancheepuram, Tiruvellore.
• R & D centre in select areas.
• Training Centres in select areas.
• Trade Centres in select areas and mechanisation process to be
introduced to upgrade the technology of the SSI sector.
• Technology centre in the lines of CFTCI.
9. Coir Industries Coir Ropes, Carpets, Door
mats, Upholstery,
Rubberized coir mattresses,
Coir Ply Board, Curled Coir
etc.
Thanjavur, Salem,
Dharmapuri, Nagercoil,
Tirunelveli.
• Creation of Common Facility Centre at selected areas.
• Creation of Product Development Centres at selected areas.
• Training centres at selected areas.
Tenth Plan Programmes
During the year 2002-03, a number of new schemes were or are to be
taken up for implementation.
• New Anna Marumalarchi Thittam under 15 Points Programme of
Chief Minister to promote Agro-Based /Food Processing Industries with
investment of one crore and above in each of 385 blocks of the State with
special package incentives and Escort Support, to generate employment
and to uplift rural economy.
• On-line Registration and issue of Provisional SSI Registration
Certificate to new Entrepreneurs through the approved Browsing Centres at
District and Taluk Headquarters was inaugurated by the Chief Minister on
12.9.2002. On-line filing for Permanent SSI Registration Certificate is also
proposed to be introduced. The furnishing of data by SSI units through online
will also be introduced.
• Public Private Partnership Concept for maintenance and
infrastructure in the Estate, Business Development/ Documentation /
Advisory Services / Consultancy Services/ Marketing Assistance, Common
Facility Centres and Product Display Business Development Centres,
Human Resource Development for development of SSI sector. Under this
scheme, a part of Capital Cost shall be borne by the Association / State
and Central Government and the Balance Capital Cost shall be obtained as
loan from financial institutions. The entire recurring expenditure shall be met
by the Associations and the Scheme shall be implemented on no-profit
basis and the cost of services shall be charged accordingly.
• Cluster Development Scheme with 75% of the cost of the Project as
Grant will be provided by Government of India towards creation of
infrastructure facilities/ services for development of Industrial Clusters. It is
proposed to establish the above services mentioned under PPP concept to
the needy viable clusters duly getting funds from Government of India.
• Formation of Export Guidance Cell under the chairmanship of the
District Collector in the District Industries Centres to provide information on
export activities, potential and procedural matters for export and to initiate
measures for development of export in the State.
On Going Schemes
Centrally Sponsored Schemes
1. Setting up of Nucleus Cells
The Nucleus Cell of this Department was created in the year 1977 so
as to collect statistics from the registered SSI units through census and to
update the data collected in the census by means of sample surveys. This is a
centrally sponsored ongoing scheme with 100% financial assistance from
Government of India. A Census-cum-Sample Survey and Diagnostic
Survey was conducted during 1995 in Dindigul, Tuthukudi, Thiruvannamalai
and Nagapattinam Districts. The field level collection of data in these districts
610
has been completed and all the collected schedules have been sent to the
Development Commissioner (SSI), New Delhi.
The 3rd All India Census of SSI Units was held in October 2002 for
which a list of SSI Units registered during the years 1992-93 to 1997-98 was
prepared and fed into the N.I.C.
A new Scheme of Collection of monthly production details from the
selected sample Small Scale Industrial Units was introduced for the purpose
of computing Index of Industrial production so as to assess the growth of this
Sector. This has assumed national importance because of the present
economic scenario. The DC (SSI) has provided Computer Hardware and
Software to the 11 selected District Industries Centres and to the district
offices for transferring the IIP to the Directorate of National Informatics Centre,
and DC (SSI), New Delhi.
A sum of Rs. 2.25 crores has been proposed for Tenth Plan for this
scheme towards staff costs which will be fully met by Government of India.
2. Prime Ministers Rozgar Yojana Scheme (PMRY)
PMRY.scheme for providing Self-Employment to Educated
Unemployed Youth was announced by the Prime Minister of India on 15th
August 1993 to provide Self-employment opportunities to one million
educated unemployed youth in the country. This Scheme benefits persons
who are educated unemployed youth in the age group of 18 to 35 years and
having passed VIII standard with family income not exceeding Rs. 40,000/-
(per annum). The age limit has been relaxed upto 45 Years in respect of
SC/STs, Ex-Serviceman, physically handicapped and women from 1.4.99
onwards. Preference is being given to those who have received training in
any trade in Government approved/ recognised Institutions (I.T.I. etc) for a
period of at least 6 months. The Scheme envisages 22.5% reservation for
SC/ST candidates and 27% for other backward classes. An outlay of Rs. 8.50
crores is proposed for implementation of the Scheme during Tenth Plan. The
entire amount will be borne by Government of India.
Centrally Shared Schemes
Market Development Assistance State’s Share – for sale of coir by Indl .
Co-operative Socities
Market Development Assistance scheme (MDA) has been approved by
the Government of India in lieu of 20% coir rebate scheme for the remaining
period of Ninth Five year Plan ie. upto 2001-2002. As per this scheme the
expenditure is to be shared by the Central and State Governments. 10% of
the annual turnover can be granted as MDA for this purpose. Under this
scheme, all the Coir products are eligible for assistance throughout the year.
A sum of Rs. 1.25 crores has been provided for Tenth plan period towards the
State’s share for this scheme.
Entrepreneur Development Institute (E.D.I.)
It is proposed to establish an E.D.I. with model of E.D.I. Ahmedabad.
This is meant to meet the entrepreneurial needs of the Southern Region in
future. Government of Tamil Nadu provided Rs. 50 lakhs during the year
611
2001-2002 with a matching grant from Government of India. During 2002-
2003, both Central and State Governments will be contributing equal sum.
During Tenth Plan a sum of Rs. 1.50 crores has been provided for this
scheme towards State’s share.
State Schemes
1.Industrial Estates-Maintenance (Maintenance of Additional sheds in TACEL
at Vridhachalam.)
TACEL Industrial Estate, Vridhachalam comprises of total area of
42.80 acres and at present there are 64 Units on rental basis. For
maintenance of the sheds in the Industrial Estate during the Tenth Plan period
a sum of Rs. 10 lakh will be provided.
2. Technical Information Sections in Industrial Estates
The Technical Information Sections are functioning at Guindy,
Ambattur, Madurai, Pettai, Katpadi, Trichy, Coimbatore and Salem to
disseminate information to the industrialists and prospective entrepreneurs.
The Sections have libraries containing technical books on Science,
Technology, Management, Industrial Information Digests and Journals,
Project profiles on SSI and details of ISI specifications for various products.
The Technical Information Section, Guindy has a well-furnished auditorium
with a video scope system. For the Tenth Plan period Rs. 30 lakhs is
provided for maintenance of Technical Information Sections.
3. State Industries Centres – EDP Training, Women Entrepreneur
Development Programme, Construction of DIC building, maintenance,
contribution to specific fund (TTM) etc.
It is proposed to train 1,25,000 women entrepreneurs within a period
of five years from 2001-02 to 2005-06 at the rate of 25,000 women per year.
During the year 2001-02, 5000 women were trained under Prime Minister's
Rojgar Yojana (P.M.R.Y.) Scheme. The balance 20,000 women were trained
at a cost of Rs. 80 lakhs. It is proposed to impart training for 25,000 persons
per year and also to construct and maintain DIC buildings and to contribute
specific funds (TTM) during Tenth Plan period. An amount of Rs. 6.97 crores
is provided.
4. Assistance to Coir Industrial Co-operative Societies
At present there are 65 Co-operative Societies in the State with 10,050
members with a paid up Share Capital of Rs. 560 lakhs. To modernise the
activities of these coir industrial Co-operatives, an Integrated Coir
Development Project is being implemented. 21 societies have been identified
for 1st Phase programme at a cost outlay of Rs. 461.94 lakhs. 3 numbers of
staff have been sanctioned for the administrative matters of the Coir Section.
For the Tenth Plan period a sum of Rs. 20 lakhs is provided to meet the
expenditure towards staff cost.
5. Assistance for setting up of Industries (Capital Investment Subsidy to
SSI Units)
New Anna Marumalarchi Thittam is being implemented for the
promotion of Agro based / Food Processing Industries in each of the 385
612
blocks of the State with minimum investment of Rs. 1 crore and above with
special package of incentives as mentioned below:
1. 15% subsidy on investment in Plant and Machinery limited to Rs. 15
lakhs per block in all the 385 blocks for investments made by the
entrepreneurs under this Scheme.
2. Power Tariff Subsidy (LTPT) of 30%, 20%, 10% of energy charges in
the first, second and third year respectively from the date of commencement
of production or date of power connection, which is later.
3. The units set up under this Scheme will be eligible for Generator
subsidy of 15% on the cost of the generator with a maximum ceiling of Rs. 5
lakhs.
4. The units employing more than 50% of their work force from women
will be eligible for additional 5% capital subsidy subject to a limit of Rs. 5
lakhs.
Besides, a new scheme, viz “Interest Subsidy under Technology
Upgradation Scheme” to supplement the 12% back-end subsidy given by
Government of India for technology upgradation of selected categories of
industries is implemented through SIDBI. For the implementation of Capital
Subsidy Scheme, a sum of Rs. 50 crores is provided for Tenth Plan
6. Technical Training Centre, Guindy – Payment to Part – time staff
Government have since ordered the transfer the courses conducted at
Government Technical Training Centre, Chennai and Institute of Tool
Engineering, Dindigul, functioning under the control of the Department of
Industries and Commerce to the Department of Technical Education. The
students admitted prior to the transfer of courses are attending second and
third year of the courses. For the conduct of classes for these students
during the year 2002-03 and 2003-04 the expenditure towards the faculty has
to be met. A sum of Rs. 3 lakhs is provided for above expenditure for 2 years
in the Tenth Plan period
New Schemes
1. Human Resource Development
It is proposed to train at least 1000 workers and 100 managerial staff
per year in each of the 10 clusters identified sectorwise and sending them
for training to National level Training Institutions for Skill and Managerial
Development. It is proposed to meet the above cost of expenditure on
60:40 basis (60% will be borne by the SSI units and 40% will be borne by
the Government). A sum of Rs. 20 lakhs is provided for the scheme during
Tenth Plan.
2. Product Display Centre
At present SSI units are not having any guidance and expertise in
import, export, finance, management and marketing aspects so as to enable
them to face global competition. They do not have any forum or agency to
inform the buyers regarding various products manufactured by the SSI
units. Hence, it is proposed to establish Trade Facilitation and Product
613
Display Centres as a Joint Venture with the District Small Scale Industries
Associations to improve the marketing. It has also been programmed to
conduct Buyer-Seller Meet in these Centres to have one-to- one discussion
with them so as to improve the marketing of their products. Government
contribution as equity for the project may be 10% of the Project cost. An
outlay of Rs. 5 crores is provided for implementation of the scheme during
the Tenth Plan period.
3. Common Facility Centre and Technology Mall
SSI units could not improve the quality of the products for want of
testing equipments due to high cost. Hence, it is proposed to establish
Common Facility Centre with the latest modem machineries/ testing
equipments to cater to the needs of the SSI units. It is also proposed to
establish centralized Common Trade/ Product Development and Design
Centre, and Machinery Demonstration Centre under one roof to offer
guidance on trade and product display available to SSIs to provide an
opportunity to the SSI units to see the working of modern machinery and, to
use the latest machinery to manufacture quality products at lesser cost, it is
proposed to establish Technology Malls at various centres. An outlay of
Rs. 3 crores is provided for implementation of the scheme in the Tenth Plan.
4. Interest Subsidy for Tech. Upgradation
It is proposed to provide 5 % Back-end interest subsidy to SSI units
for the loan obtained for technology upgradation to supplement Credit
Linked Capital Subsidy announced by Government of India so as to help the
SSI Units to come out of their present difficulties on account of outdated
technologies and to face the global market with quality product at
competitive price. An outlay of Rs. 10 crores is provided for implementation
of the scheme in the Tenth Plan.
5. Tech & Financial Consultancy support to SSI
It is proposed to provide technology and financial consultancy
services to the SSIs / Tiny Units in the identified thrust areas and to the
needy entrepreneurs. This will enable them to access funds for the projects
from Financial Institutions in a credible manner. In this regard expert panel
will be drawn for each of the thrust sectors by taking the assistance of
reputed companies and individual experts within and outside the country.
These supports will make the SSI/ Tiny sector entrepreneurs to become
aware of the technological processes, innovative methods being followed at
international level to equip themselves to meet the global competition and
the growing demand. During Tenth Five Year plan, priority will be given to
develop the above mentioned thrust sectors. It is proposed to give
incentives for Technical financial consultancy support not exceeding Rs. 1
lakh per unit for 100 SSI units by providing Rs. 1 crore per year and,
therefore, the outlay for Tenth Plan will be Rs. 5 crores.
Public Sector undertakings under Small Industries
SIDCO
There are at present 73 Industrial Estates where necessary
Infrastructural facilities such as water supply, electricity, roads etc. are
614
looked after by SIDCO. This will be continued and new industrial
infrastructure will be created in rural areas based on the demand in the
Tenth Plan period in accordance with the objectives of the Corporation.
NSIC – SIDCO Small Industries Development Corporation (SIDCO) for
composite Loan Scheme to Tiny Sector Industries
National Small Industries Corporation (NSIC) has introduced a new
composite term loan scheme for the tiny sector industries. Under this
scheme, a total loan upto Rs. 25 lakhs is given towards investment in land
and building, plant and machinery and working capital required for the tiny
sector units. NSIC with SIDCO will extend the above loan on the single
window concept.
TANSI
The Tamil Nadu Small Industries Corporation Limited (TANSI) was
formed in 1965 to take over from the Government, to begin with, 64
departmental small-scale units with net assets amounting to Rs. 668.612
lakhs to be run on commercial lines. These industrial units were started under
the plan periods earlier under the control of the Directorate of Industries and
Commerce for non-commercial purposes such as
i) to serve as Training cum Demonstration Centres;
ii) to provide infrastructure for the development of industries; and
iii) to ensure dispersal of economic growth.
They were later converted into manufacturing units.
After transfer of certain units back to Industries Department, two units
to TACEL (Tamil Nadu Ceramics Ltd.), one unit to Tamil Nadu Agro Industries
Corporation and closure of two units, TANSI was running for a long time 56
units. The activities relating to mining and export of granite blocks were
transferred to the Tamil Nadu Minerals Ltd. on its formation. During 1986 four
units were transferred to Tamil Nadu Leather Development Corporation Ltd.
Certain other units were closed down under restructuring programmes.
TANSI is a conglomeration, at present, of 26 production units and 6 Sales
Centres. The product lines of TANSI fall under Structurals, Engineering,
Foundries, Furniture, Pumps and Pump Spares, Spirit based products,
Assembly of TITAN watches, paints and allied products.
TALCO
The Tamil Nadu Leather Development Corporation Ltd. was
established in 1983 with the main objective of developing leather industry in
Tamil Nadu by (1) helping tanners by supply of raw materials, chemicals etc.,
(2) assisting artisans engaged in the manufacture of footwear and leather
goods by providing market link, (3) improving skills and efficiency of small
artisans, (4) affording infrastructure facilities to prospective entrepreneurs in
leather industry and (5) dealing with the problems faced in tannery effluent by
establishing Common Effluent Treatment Plants. The Committee headed by
Thiru S.V.S. Raghavan to study the performance of the State Public Sector
Enterprises recommended the winding up of the Corporation in view of the
615
fact that its 4 leather units were sick and the Corporation was making losses.
Government issued orders in October 2000 for closure. Khadi and Village
Industries Board has taken over the production units of TALCO.
An outlay of Rs. 83.50 crores have been provided to implement the
schemes for Small Industries Sector during Tenth Plan. Details of outlay
are furnished below:
Schemes and Outlay for Tenth Plan 2002-2007
(Rs. . in crores)
Sl.No Schemes Outlay
1
(A) On Going Schemes
Industrial Estates –Maintanence
0.10
2 Technical Information Sections in Industrial Estates 0.30
3 State Industries Centres:- Women Entrepreneur Development
Programme, Construction of DIC Building, Maintenance of building
and contribution to specific fund (TTM).
6.97
4 Assistance to Coir Industrial Coop Societies 0.20
5 Assistance of setting up of Industries - Capital Subsidy
(As per the New Anna Marumalarchi Thittam, this subject is
continued only to Agro-based/Food Processing Units to be set up in
385 blocks of the state and earlier subsidies to SSI units are
withdrawn by the government. Hence this amount will be utilised on
priority basis to the projects under NAMT and the balance amount
will be disbursed to the earlier sanctioned cases.)
50.00
6 Technical Training Centre, Guindy -- Payment to part-time staff
(Consequent on the transfer of the courses conducted by the Institute
of Tool Room Engineering, Dindigul to Director of Technical
Education, an outlay of Rs. 0.03 crores is provided towards the
expenditure of faculty for conduct of classes for the students
attending second and third year of the courses at Institute of Tool
Room Engineering, Dindigul)
0.03
7 Market Development Assistance State's Share-for sale of coir by I.C
Societies
1.25
8 Entrepreneur Development Institute 1.50
Total (A) - On going schemes 60.30
1
(B) New Schemes
Human Resource Development
0.20
2 Product Display Centre 5.00
3 Common Facility Centre and Technical Mall 3.00
4 Interest Subsidy for Technical Upgradation 10.00
5 Technical and Financial Consultancy support to SSI 5.00
Total (B) - New Schemes 23.20
Grand Total (A) & (B) 83.55
II. Handlooms and Textiles
The textile industry is a major foreign exchange earner for the
country. It earns more than 35% of the total exports revenue. Textile
industry is a predominantly cotton based industry and is facing crisis due to
adverse effect of globalisation, excess production, decline in exports,
nonavailability
of adequate quantity of quality cotton, increase in cotton prices,
etc. The Textile Industry is extremely crucial in terms of employment and
economic well-being of the State considering that it is next only to
Agriculture in the scope of employment.
616
Handlooms - Handlooms form a part of heritage of India and
richness and diversity of our country and artistry of the weavers. It plays a
very important role in the economy. Handloom is the largest economic
activity after agriculture. This sector is estimated to provide direct and
indirect employment to more than 30 lakh weaver households and about
130 lakh weavers in the country (!999-2000). Due to effective State
intervention through financial assistance and implementation of various
developmental and welfare schemes, this sector has been able to
withstand competition from the powerloom and mill sectors. Production in
this sector was 6792 million sq.meters in 1998-99. This sector contributes
substantially to the export income of the country.
According to the 1987 Handlooms census, there were 4.27 lakh
Handlooms in Tamil Nadu. There are as on 31.3.2002, 2.83 lakh handlooms
functioning in 1414 Primary Handloom Weavers' Co-operative Societies.
The Weavers' Co-operative Societies exist in rural and semi-urban areas
where there is a large concentration of handloom weavers. All the benefits
of the development and welfare schemes implemented by the State
Government and the Government of India are channelised through these
societies.
The average annual production of various varieties of handloom
goods by these societies is around 950 lakh metres and the annual sales
turn over around Rs. 450 crores.
Tamil Nadu has always occupied a pride of place in having the
maximum number of handlooms in the country. This sector continues to
be alive in spite of setbacks on account of quantum jump in Powerlooms.
Although major areas of the State which are dependent heavily on
handlooms have been affected on account of lack of demand in the market,
there are sectors where handlooms are progressing well. There are about 3
lakh handlooms, of which 1.50 lakh handlooms are within the Co-operative
fold. Handloom Weavers Co-operative Societies have been fairly
successful in breaking the element of bondedness among Master Weavers
and their subordinates. Better wages, welfare measures and the like have
gone a long way in this. Co-operative Societies need to continue to be
patronised as a welfare measure without ignoring those outside the Cooperative
fold.
Powerlooms - The decentralised powerloom sector plays an
important role in meeting the clothing needs of the country. The powerloom
industry produces a variety of cloth both grey as well as processed bearing
intricate designs. The contribution of the powerlooms sector to the total
cloth production in the country is about 59%, excluding the cloth produced
by non-SSI, weaving and hosiery /knitting units. This sector also
contributes significantly to the export earnings.
There are 3.20 lakh registered powerlooms in Tamil Nadu. These
powerlooms are situated within and outside the Co-operative fold. There
are nearly 25,000 powerlooms operating in 149 Powerloom Weavers'
Cooperative
Societies with about 9,000 weaver members. These societies
produced 154.22 lakh metres of cloth valued at Rs. 20.74 crores and
effected sales to the tune of Rs. 19.68 crores during 2001-02. The
617
Powerloom Weavers Co-operative Societies mainly produce the cloth
required for scheme of free supply of uniforms to school children and
distribution of sarees and dhoties.
Textiles - The Textile Industry of the State is the forerunner in
Industrial development and is providing massive employment. It is
predominantly spinning oriented. Out of 1937 large and medium textile mills
in the country, 893 mills are located in the State. Similarly, out of 921 small
units in the country, 745 are located in the State. The 893 large and
medium textile mills include 18 Co-operative Spinning Mills, 17 NTC Mills
and 25 Composite Mills. The spinning capacity is 14.30 million spindles and
the labour force 2.32 lakhs.
The Textile Industry has a very important role in the industrial field
with regard to employment potential and overall economic and commercial
activities. This industry enables the Central and State Governments to earn
revenue besides foreign exchange through exports. 25% of Indian yarn is
exported and 35% of Indian yarn is from Tamil Nadu.
Garments - Garments occupy a predominant position in World trade
as it is the second fastest growing product category next only to office and
telecom equipment. In India, 12% of total exports in India is from the
Garment Industry and it provides direct employment to over 20 lakh people.
In Tamil Nadu, the garment sector is located substantially around Chennai,
with specialisation in cotton fibre garments (2/3 of the total garment
exports). Garments includes knitwear but for the purpose of understanding,
knitwear has been taken as a separate sub-category. The garments
industry around Chennai accounts for over Rs. 2000 crores in exports. 45%
of all garment exports is to the EU and 35% to the U.S. The garment sector
has been functioning without any Government help.
Knitwear - The Knitwear Industry in the Country is located at
Tiruppur in Coimbatore District. Estimated at over Rs. 4000 crores in
exports, this industry has been at the helm of textile exports for a long
period of time and has acquired international fame. Its strength is due to
skilled manpower and rich raw material base.
Processing - Pre-loom and Post-loom processing facilities have not
grown adequately to meet the demand of the textile industry. In Tamil
Nadu, processing facility is mainly in the unorganised hand dyeing/ hand
printing sector.
Ninth Five Year Plan (1997-2002)
Financial Performance
The approved outlay for the Handlooms and Textiles sector for the
Ninth Five Year Plan was Rs. 240 crore and the expenditure incurred was
Rs. 128.64 crores. The yearwise expenditure incurred during Ninth Plan
period is furnished below:
618
Handlooms and Textiles-Ninth Plan Performance
Financial (Rs. in lakhs)
Year Expenditure
1997-98 2002.75
1998-99 3344.52
1999-00 2375.89
2000-01 2540.10
2001-02 2600.43
Total 12863.69
Physical Performance
As against a target for the establishment of 100 Handloom
Development Centres, 38 Handloom Development Centres were
established as on 31.03.2001; similarly, as against a target of 25 Quality
Dyeing units, 4 Dyeing units were formed. As on 31.03.2001, 86,221
weavers benefitted under Central Thrift Fund. In respect of construction of
House-cum-Workshed scheme, 3310 Houses were constructed as against
a target of 5000 houses as on 31.3.2001 3420 units were provided units
worksheds to the existing houses as against a target of 10,000 units as on
31.3.2001.
The problems besetting the sector and the issues which will have to
be addressed in the Tenth Plan with suggestions / recommendations are
detailed in the Annexure.
Tenth Five Year Plan (2002-2007)
Outlay and Programmes
An outlay of Rs.180 crores has been proposed for “Handlooms and
Textiles” for Tenth Plan. The details of programmes to be taken up during
the Tenth Plan period are given below.
1. Deendayal Hatkargha Protsahan Yojana
Government of India has formulated a new integrated and
comprehensive scheme for development and promotion of Handlooms, viz.,
Deendayal Hathkargha Protsahan Yojana Scheme with effect from
1.4.2000.
The components of this scheme are:
(a) Basic Inputs, (b) Infrastructure support, (c) Design Input, (d)
Publicity, (e) Marketing incentive/ Rebate and (f) Strengthening of
Handloom Organisations.
The above scheme was introduced since 01.4.2000. Government of
India have decided to continue this scheme in the Tenth Plan also. The
cost is shared between the Centre and States on 50:50 basis. The outlay
for the scheme during the Tenth Plan will be Rs. 100 crores.
619
2. Interest Subsidy Scheme
The Interest Subsidy scheme is one of the vital schemes being
implemented by the Department from the funds of State Government. From
the year 1989-90, the Interest Subsidy Scheme was one of the component of
Government of India's Scheme of Market Development Assistance Scheme.
As Market Development Assistance Scheme was discontinued from 1.4.2000,
the State Government has to meet the cost on the Interest Subsidy.
A total outlay of Rs. 22 crores is provided for implementation of this
scheme in the Tenth Five Year Plan.
3. Weavers House-cum-Workshed Scheme
The Weavers House-cum-Workshed scheme has been under
implementation from 1979-1980 onwards with State Government subsidy
and HUDCO loan. From 1985-1986, the G.O.I., has also been participating
in the scheme by sanction of subsidy. A unit of House-cum-Workshed in
urban area costs Rs.72,000 which comprises of State Subsidy of Rs.
10,000 (increased from Rs. 7,000), Central Subsidy of Rs. 20,000,
beneficiary's contribution of Rs. 5,000 and loan of Rs. 40,000 provided by
HUDCO. It is proposed to construct 5000 units (in rural areas and urban
areas) during Tenth Plan. The cost per unit of House-cum-Workshed in
rural area is Rs. 68000/- . The total cost of the project is Rs. 35 crores
which includes Government of India’s subsidy of Rs.10 crores and State’s
subsidy of Rs.5 crores.
An outlay of Rs. 5 crores has been proposed as State subsidy for
this scheme for the Tenth Plan.
4. Insurance Scheme for Handloom Weavers
The Government of Tamilnadu is implementing Insurance Scheme
for the Handloom Weavers with the financial assistance of Government of
India. In the event of death of a member before attaining the age of 60
years, the State Government is sanctioning Rs. 50,000/- for the nominees of
the deceased Handloom Weavers towards Insurance amount apart from
Co-optex Contribution of Rs. 15,000/- (increased from Rs. 10,000/- with
effect from 15.09.01). The Govt. of India's share towards premium is being
claimed every year at Rs. 40/- per weaver. Under this scheme, the State
Government meets the amount over and above the Government of India’s
contribution.
The provision for the scheme for Tenth Plan will be Rs. 6.50
crores.
5. Workshed Scheme
Apart from House-cum-Workshed scheme, the Government of India
has been providing subsidy for construction of Worksheds for the dwellings
of the weavers since 1997-98. The cost of Workshed in rural areas is Rs.
9,000 and in case of urban areas Rs. 14,000, for which the beneficiary has
to contribute Rs. 2000 and Rs. 4000 and the Government of India provides
a subsidy of Rs. 7,000 and Rs. 10,000 respectively. It is proposed that the
Government of Tamilnadu may also participate in this scheme as in the
620
case of house-cum-workshed scheme by providing Rs. 2000 per unit.
During Tenth Plan period, it is proposed to construct 10,000 Worksheds at a
cost of Rs. 2 crores.
6. 90% Loss Guarantee Scheme
(Assistance to Co-operative Central Banks towards loss sustained in the
issue of Working Capital to Weavers Co-operative Societies)
Ninety Percent Loss Guarantee Scheme was introduced by
Government of India in 1956 with a view to provide Guarantee cover to
Cooperative Central Banks and to offset the losses arising out of nonrecovery
of loans advanced by them to Handloom Weavers Cooperative
Societies under Reserve Bank of India Handloom Finance Scheme.
The Government has been extending guarantee in respect of Working
Capital Finance extended to Weavers Cooperative Societies from NABARD
through Central Cooperative Banks. In case of any eventuality of Primary
Weavers Cooperative Societies going into liquidation and where there is no
possibility of recovery of dues by the Central Co-operative Banks from such
societies, the loss sustained by the Central Co-operative Banks is reimbursed
by the Government to the extent of 90%. The exact requirement of funds
could not be estimated precisely and, therefore, a token provision of Re.1
crore is allocated for the purpose. The requirement will be taken note of and
necessary adjustments made in the Annual Plans and the Mid-Term
Appraisal.
7. Creation of Data Bank
India is one of the signatories of the World Trade Organisation
Agreement 1955. The World Trade Organisation will cover the entire global
trade and the Agreement is committed to establish an open and liberal global
environment, free from any restrictions Therefore, the Indian Industry has to
compete with the multinational companies in the domestic market as well as
the foreign market. The Agreement on Textiles and Clothing, which is one of
the Associate Agreements of the World Trade Organisation, covers the World
Trade Textile Trade.
Like any other Industry, the textile industry will also face stiff
competition to retain and enter new market. To prepare the Textile industry
in general and the Handloom industry in particular, the Government has
taken initiative to re-orient its focus and activities and programmed to create
a 'Data Bank' in the Department so as to build up a reliable Information
System on data for market intelligence. It is proposed to establish functionary
centres in order to collect market facts on products, total market distribution
and their channels, consumers competitions, import rules and regulations,
economic factors and specific market characteristics and price trends, the
availability and requirements of Handloom products and disseminate this
information among the Weavers Co-operative Societies involved in Export
business.
The provision for this scheme will be Rs. 10 lakhs as State
Government subsidy for Tenth Plan.
621
8. Assistance for conduct of Exhibition including Advertisement & Publicity
and Popularisation of “Loom World”
As a part of marketing strategy, Cooperative Societies have decided
to market their products under the brand name “LOOM WORLD”. The
various popular varieties such as Silk & Cotton Sarees, Shirtings, Dhoties,
Angavastram etc., are exhibited in the “Loom World” Showrooms. It is
proposed to launch such showrooms at Kancheepuram, Anna Salai etc.,
shortly. To popularize the above concept exhibitions are to be conducted in
various places. Initially, Government assistance is required for
advertisement and publicity and for conduct of Exhibitions. Five such
Exhibitions are proposed every year at a cost of Rs. 4 lakhs including
advertisements.
An outlay of Re. 1 crore has been proposed as assistance for
Tenth Five Year Plan.
9 Scheme for conversion of Handlooms into Powerlooms
The Government has decided to reintroduce the scheme of
conversion of Handlooms into Powerlooms. A Committee has been
constituted by the Government to formulate a new scheme for technology
upgradation. It has been programmed to convert 5,000 Handlooms to
Powerlooms in a phased manner.
An outlay of Rs. 20 crores has been proposed for Tenth Plan.
10. Training for Weavers
It is proposed to impart training for 250 Handloom Weavers every
year at an estimated cost of Rs. 2000 per weaver/per annum. The annual
commitment for providing training to weavers is Rs. 5 lakhs.
An outlay of Rs. 25 lakhs is proposed for this scheme for Tenth Plan.
11. Tamil Nadu Zari Ltd.
Tamil Nadu Zari Limited, Kancheepuram is a Public Sector
undertaking established for manufacturing and supplying of quality Zari to
Silk Weavers Co-operative Societies at reasonable prices. A second unit
was also set up at Kumbakonam. The Company produced and sold
64,750 marcs of Zari during 2000-01. It is a profit making unit and has been
declaring dividend to Government on its share capital continuously. It has
been programmed to modernize the machineries at an estimated cost of
Rs. 50 lakhs during Tenth Plan period.
An outlay of Rs. 50 lakhs has been proposed for this scheme for
Tenth Plan.
12. Tamil Nadu Co-operative Textile Processing Mills Ltd., Erode
The Tamil Nadu Co-operative Textile Processing Mills Ltd., Erode
was established in 1973 to take up Textile Processing like Bleaching,
Dyeing, Mercerising, Printing and finishing of cotton and Synthetic fabrics.
The capacity to process is 12 lakh meters/per month. It is proposed to
modernize the unit at a cost of Rs. 1 crore during the Tenth Plan Period.
622
An outlay of Re. 1 crore has been proposed for this scheme for
Tenth Plan.
13. Assistance to Co-operative Spinning Mills
With the objective of supplying of good quality yarn at reasonable
rates to Cooperative Handloom Weavers without interruption, 18
Cooperative Spinning Mills were set up with an installed capacity of 4.69
spindles. The Spinning Mills produce 50% of the Hank Yarn requirement of
Handloom Weavers and Cone Yarn requirement of Powerloom Industries.
Except Anna Cooperative Spinning Mills and Bharathi Cooperative Spinning
Mills, most of the Spinning Mills are in a financially bad condition. Several
Textile mills are closed /on verge of closure. Four Cooperative Spinning
Mills have stopped production. Therefore, Government is examining the
possibility of privatizing the loss making mills. For one time settlement of
liabilities of the Cooperative Spinning Mills, loan assistance will be
sanctioned by Government to the Mills.
A provision of Rs. 20 crores has been proposed as loan assistance
for Tenth Plan period.
14. Tamilnadu Cooperative Spinning Mills Federation Ltd (TANSPIN),
Chennai.
Tamilnadu Cooperative Spinning Mills Federation Ltd (TANSPIN)
was established in the year 1994 to streamline the procurement of cotton
at reasonable prices for the member Cooperative Spinning Mills. It fulfils
10% of the total requirement of cotton of the member Mills. The net profit of
the Federation is Rs. 25 lakhs for the year 2000-01. It is proposed to
expand its activity during Tenth Plan period.
An outlay of Rs. 65 lakhs has been proposed towards Share Capital
Assistance for Tenth Plan.
The details of schemes and outlay proposed for "Handlooms and
Textiles" for the Tenth Five Year Plan (2002-07) are given below:
(Rs. in crores)
Sl.No. Schemes Outlay
Spillover Schemes
1 Deendayal Hathkargha Protsahan Yojana Scheme 100.00
2 Interest Subsidy Scheme 22.00
3 House-cum-workshed Scheme (Rs. 2000 HUDCO loan) 5.00
4 Insurance scheme for Handloom Weavers 6.50
5 Workshed Scheme 2.00
6 90% Loss Gurantee Scheme 1.00
Total - Spillover Schemes 136.50
New Schemes
1 Creation of Data Bank 0.10
2 Assistance for conduct of Exhibition including Advertising and Publicity
for Popularising "Loom World" 1.00
3 Conversion of Handlooms in to Powerlooms 20.00
4 Training for Weavers 0.25
5 Assistance to Tamilnadu Zari Ltd. 0.50
623
(Rs. in crores)
Sl.No. Schemes Outlay
6 Asst to Tamilnadu Coop. Textile Processing Mills Ltd., Erode. 1.00
7 Assistance to Cooperative Spinning Mills 20.00
8 Asst to Tamilnadu Coopt Spinning Mills Federation 0.65
Total - New Schemes 43.50
Total - State Schemes (Handlooms & Textiles) 180.00
III. Khadi and Village Industries
Khadi and Village Industries have been instrumental in generating
large scale employment, particularly in rural areas, with low capital investment
and short gestation periods. The total employment provided in the country in
khadi industry increased from 0.66 million in 1955 to 1.24 million in 1999-2000
and from 0.31 million to 4.69 million in Village Industries during this period.
Nearly 40% of employment provided by KVIC is to women and 32% to SCs
and STs.
Khadi and Village Industries play a vital role in providing selfemployment
in rural areas utilizing the local resources.
Keeping this in view, the Tamil Nadu Khadi and Village Industries
Board (KVIB) was established in 1960 with the main objective of providing
employment in rural areas. The Board has been pursuing this objective by
implementing schemes formulated by the Khadi and Village Industries
Commission and the State Government. The Co-operative Societies
registered under Khadi and Village Industries Board are undertaking activities
approved by Khadi and Village Industries Commission / Khadi and Village
Industries Board.
Khadi - The Board has established production centres for khadi cotton
and poly vastra fabrics in different parts of the State. The major centre for
production of khadi cotton and poly vastra fabric is in Tirupur region.
Currently 3888 spinners and weavers are being provided employment by the
Board directly.
Silk - KVIB is known for its exquisite Khadi Silk Sarees, made
specially from original Zari, using eco-friendly and Natural dyes.
Kumbakonam, Kanchipuram, and Arani are the major centres of production.
The Khadi units working under KVIB are indicated below:
Sl.No. Khadi No.
1. Rural Textile Centres (spinning Centres) 358
2. Production Centres 86
3. Silk Yarn Twisting Centres 5
4. Silk Production Centres 34
5. Dyeing Units 5
6. Dyeing Bleaching and Printing Unit 1
7. Quilt Unit 1
8. Tailoring Units 3
9. District Godowns 26
10. Central Godown 1
624
Village Industries - KVIB has been promoting Village Industries by
establishing production centres in different districts, organizing Co-operative
Societies and granting margin money to Entrepreneur for establishing Village
Industrial Units. KVIB provides support by providing raw materials required
for production, technical guidance and marketing the finished products
through the sales outlets. The items produced by the Self-Help Groups are
being sold through the Khadi Crafts.
Taking advantage of the purchase preference extended vide
G.O.Ms.No. 283, Finance (BPE) Department dated 18.6.98, KVIB is supplying
furniture, soaps, honey and leather articles to different Government
departments. The products of the Board are sold to the public through its
public retail outlets, Khadi Crafts, spread through out the State. KVIB has
major presence in leather and soap industries, hand made paper, carpentry
and blacksmithy and apiculture though more than 58 Village Industries are
being promoted. The details of own units of the KVIB under Village Industries
sector are indicted below:
Sl.No. Industry No.of
Units
1. Non edible Oil and Soap Industry 38
2. Carpentry and Black smithy 9
3. Bee Keeping 83
4. Processing of Cereals and Pulses 1
5. Pottery and Brick 5
6. Handmade Paper 4
7. Lime 1
8. Aluminium 1
9. Leather 24
Total 166
The production during 2000-2001 was as follows:
(Rs. in lakhs)
Khadi 1267.70
Village Industries 1163.54
Total 2431.24
The employment generated during 2001-2002 was as follows:
(Rs. in lakhs)
Khadi 0.21
Village Industries 17.98
Total 18.19
Khadi and Village Industries Board has established Industrial Cooperative
Societies both in Khadi and Village Industries sectors. There are
1369 Industrial Co-operative Societies functioning under KVIB out of which
1004 relate to Palm Jaggery and Palm leaf manufacturing.
625
Ninth Plan Performance
The total allocation for Khadi and Village Industries Sector for IX Five
Year Plan was Rs. 100 crores out of which a sum of Rs. 48.44 crores was
released. Out of this amount, 89% was for rebate on sale of Khadi and the
remaining amount (11%) for new schemes. Khadi and Village Industries
development is also supported by the Centrally Sponsored Programmes such
as the Hill Area Development and the Western Ghat Development
Programme. The employment generated by Tamil Nadu Khadi and Village
Industries Board up to the Ninth Plan period is estimated to be around 16
lakh persons and the value of production in the Units / Co-operative Societies
supported by KVIB is estimated at about Rs. 161.09 crores.
Tenth Five Year Plan Outlay
The main objective of the Khadi and Village Industry Programme
during Tenth Plan will be to generate additional employment opportunities for
the rural poor and artisans. Tamil Nadu Khadi and Village Industries Board
has proposed to create additional employment for 11,100 persons under the
Khadi sector and 60,425 persons under the Village Industries sector (totally
71,525) during Tenth Plan period. An outlay of Rs. 70 Crores is proposed in
the Tenth Plan for various schemes of Khadi and Village Industries Board and
Palm Products Industries under the Tamil Nadu Palm Products Development
Board. The details of schemes proposed to be implemented in the Tenth Plan
are outlined below:
Tenth Plan Programmes
I. Khadi Schemes
1. Replacement of Charkhas (Cotton & Polyester)
358 Rural Textiles Centres are running under the control of Khadi
Board without required charka accessories. It is proposed to replace the
cotton Charkas with 8-spindle charka set. The total capital expenditure
required for replacement of 15 Charkas will be Rs. 45 lakhs at Rs. 3 lakhs
per Charka. Similarly, it is also proposed to replace the Charkas with 8
spindle charka for weaving polyester cloth at a total cost of Rs. 100 lakhs.
2. Modernization of Looms (cotton)
At present 86 Khadi sub centres are working under the control of Khadi
Board. It has been decided to produce saleable Khadi varieties by widening
800 looms at a cost of Rs. 2500/- per loom in the first phase. The total cost
will be Rs. 20 lakhs.
3. Weaving Centres (Polyvastra)
The Board has proposed to enlist 500 looms for weaving polyester
cloth. This will create additional employment to 500 weavers during the Tenth
Five Year for which an outlay of Rs. 50 lakhs is proposed.
4. Modernization of Silk Looms
In order to create additional employment under Silk Industry the Board
has proposed to modernize the existing 2000 looms at a cost of Rs. 2500/-
626
per loom. An outlay of Rs. 50 lakhs has been proposed in the Tenth Plan for
the above scheme.
5. Provision of Jungus and Design Cards
In order to create additional employment under silk industry, it is
proposed to provide jungus and design cards to 2000 weavers for creating
new attractive designs during the Tenth Five Year Plan at a cost of Rs. 2500
per set. The outlay proposed for the above scheme is Rs. 50 lakhs.
6. Training
During Tenth Plan it is proposed to impart training every year in short
term, long term and refresher courses to motivate the young entrepreneurs.
It is also proposed to establish one State Level Khadi Training Centre. The
cost of the Training Programme proposed for Tenth Plan is Rs. 55 lakhs.
7. Modernization of Emporium
It is proposed to modernize 5 emporiums exclusively for Sale of silk
varieties. An outlay of Rs. 1 crore has been proposed for the above scheme
for the Tenth Plan.
8. Rebate
Rebate on Sale of Khadi in respect of Tamil Nadu Khadi and Village
Industries Board and certified institutions will be continued in the Tenth Plan
to safeguard the employment of weavers. An outlay of Rs. 50 crore is
proposed for the above scheme for the Tenth Plan.
9. Provision of Computers to District Offices and Important Khadi Krafts
It is proposed to create Data Base by providing Computer to District
Offices to avoid delay in decision making. 26 Computers with Printers, UPS
and Fax Machine are proposed to be purchased. It is also proposed to
provide Franking Machine to all Assistant Directors' Offices. The total outlay
for the scheme for the Tenth Plan will be Rs. 30 lakhs.
II. Village Industries
Tamil Nadu Khadi and Village Industries Board is providing assistance
by providing training to entrepreneurs for establishing Village Industries,
supply of improved tools and equipments, finance, workshed, raw materials,
marketing and organizing co-operative societies for groups. Village Industries
are employment intensive and require little capital but earnings per worker
are low and hence requires to be graded up so as to compete in the highly
constrained market. The following schemes are proposed for Tenth Plan for
the development of Village Industries.
1. Margin Money to weaker section
Under the above scheme artisans of weaker section have to contribute
only 5% of the project cost as own contribution and the Bank will sanction
95% of the project cost. Soon after release of 1st instalment, 30% of the
project cost will be sanctioned as Margin Money in the form of back ended
subsidy. A sum of Rs. 5 crores is proposed for the scheme during the Tenth
Plan.
627
2. Research and Development of Apiculture under Eastern Ghat Development
Programme (EGDP) – Beekeeping
Beekeeping is an ideal activity for development as a subsidiary
occupation providing supplementary income to a large number of rural and
tribal people due to the rich flora available in the rural areas. Beekeeping not
only offers honey and by-products to mankind but also enriches agrihorticultural
crops in quality and quantity by its unique crop pollination
services.
An outlay of Rs. 3 crores is proposed for the above programme for the
Tenth Plan towards cost of starting Bee Nurseries, distribution of Bee Hives
and accessories, training in bee-keeping, setting up of Honey processing
plants and establishment of a Honey Testing Laboratory.
3. Strengthening of Co-operative Societies of Tribals and Training to Tribals
It has been proposed to assist 20 co-operative societies, which were
started for the benefit of scheduled caste and scheduled tribe artisans by
giving adequate machinery to tools and equipments, etc. at Rs. 2 lakhs per
Society. The total outlay will be Rs. 40 lakhs. The Board's departmental
units such as hand made paper, foot-wear, pottery, soap, carpentry and
blacksmithy and Co-operative societies under village oil, pottery, carpentry
and blacksmithy, beekeeping, mat, etc., under TRYSEM do not have
adequate facilities. It is proposed to train 500 artisans in District
Headquarters in a year and to provide machinery, audio and video etc. for
which an amount of Rs. 10 lakhs will be provided in the Tenth Plan.
4. Western Ghat Development Programme
Under this programme 30 taluks have been identified in the districts
of Tirunelveli, Virudhunagar, Dindigul, Theni, Madurai, Kanyakumari,
Coimbatore and Erode to assist artisans under cane and bamboo, mat,
leather, beekeeping and distillation of Eucalyptus oil. It is proposed to
provide assistance on beneficiary oriented schemes during Tenth Plan
under village industries for essential oil extraction, bee keeping, cane and
Bamboo, mat and fibre etc., to cover 4000 beneficiaries. The outlay will be
Rs. 2 crores.
5. Modernization of Footwear Unit
It is proposed to modernize the existing footwear units by providing
improved machinery, upgrading the skill of the artisans at an estimated cost
of Rs. 10 lakhs per unit. The outlay will be Rs. 50 lakhs for the Tenth Plan.
6. Conversion of Soap Units into Toilet Soap Units
There is heavy demand for the Toilet Soaps manufactured by the
Khadi Board. The Board is running only one Toilet soap unit. 4 Washing
soap units will be converted into toilet soap units. Conversion cost per unit
would be Rs. 5 lakhs and the estimated cost for X plan would be Rs. 20
lakhs.
7. Hill Area Development Programme
It is proposed to assist 2000 persons through the schemes like
distribution of distillation plants, setting up of bee-nurseries, provision of
628
machinery and equipments for manufacturing units, jute bag stitching unit,
paper bags and paper covers, construction of workshed and other village
industries goods. An outlay of Rs. 150 lakhs is proposed during X plan
under HADP.
8 Research and Development under Hand Made Paper Industry
In order to produce very high-grade variety of Hand Made Paper such
as drawing paper for artwork, permanent document paper, greetings cards,
stationery item, unique carry bags, watermark certificates, filter and plotting
paper etc., it is proposed to take up research and development at a cost of
Rs. 15 lakhs.
9. Marketing and Development by conducting Exhibitions, Fashion Shows, etc.
It is proposed to conduct thematic exhibitions throughout the year
mainly to encourage the traditional artisans to sell their products to the
customers at an affordable price. To conduct exhibitions throughout the year
at the important Khadi Krafts like Coimbatore, Salem, Trichy, Madurai and
Tirunelveli it is proposed to instal/ permanent structures like Galleries, Racks,
Showcases, etc., at a cost of Rs. 50 lakhs during the Tenth Plan period.
III. Palm Products Industry under the fold of Tamil Nadu Palm Products
Development Board
Palm Products Industry is one of the major Industries among Village
Industries in Tamil Nadu. Tamil Nadu is pioneer in development of Palm
Products Industry in India. Out of the estimated 8.59 crores of Palmyrah
trees in India, about 5.20 crores of Palmyrah trees are in Tamil Nadu. Tamil
Nadu is a potential centre for the growth and development of Palm Products
Industry. It also earns foreign exchange by export of Palm Products. The
Tamil Nadu Palm Products Development Board which has been functioning
with effect from 6.1.1995 is not directly involved in trading, but 996 Primary
Jaggery Manufacturing Co-operative Societies, 8 District Palmgur Marketing
Co-operative Federation and one Tamil Nadu State Palmgur and Fibre
Marketing Co-operative Federation functioning under the fold of the Board are
directly engaged in trading activities. Edible products such as Neera, Palm
Jaggery, Palm Candy, Palm Sugar, Palm Fruit Jam, Preserved Nungu and
other confectionary products and Non edible items like Palm fibre, Palm Leaf
products, Palm Naar products Brush varieties, Baskets, etc are produced and
marketed by them. During Ninth Five Year Plan the State Government
sanctioned a sum of Rs. 54.22 Lakhs for New Schemes and Rs. 15.00 Lakhs
under Western Ghats Development Programme for the implementation of
Palm Products Development Schemes.
The potential areas of Tamil Nadu have to be utilized by raising Palm
trees in Government lands and Panchayat lands so as to provide employment
opportunities to the rural palm products artisans and also to prevent soil
erosion. It is necessary to introduce new technologies for procurement and
preservation of Neera for the production of Palm Products. It is essential to
provide funds for Research and Development for inventing a device for
climbing Palmyrah trees so as to provide employment to the unskilled and
629
educated employed youth. A sum of Rs. 1.65 crores is proposed in the Tenth
Plan for implementation of Palm Products Schemes:
Outlay for Tenth Plan for development of Khadi and Village Industries.
(Rs. in crores)
Sl.No Name of the Scheme Outlay
Khadi and Village Industries Schemes
A)
1
Khadi Schemes
Replacement of Charkhas (Cotton)
0.45
2 Modernization of looms (Cotton) 0.20
3 Replacement of Charkhas (Polyester) 1.00
4 Weaving Centres (Polyvastra) 0.50
5 Modernization of silk looms 0.50
6 Provision of Jungus and design cards to silk weavers 0.50
7 Khadi Scheme Training 0.55
8 Modernization of Silk Emporium 1.00
9. Rebate 50.00
10 Provision of computers and franking machine to District
Offices and Important Khadi Krafts
0.30
Total (A) Khadi Schemes 55.00
B) Village Industries Schemes
1 Margin Money for Weaker section 5.00
2 Research and Development and Agriculture under E.G.D.P. 3.00
3 Strengthening of Co-operative Societies of Tribals and
Training
0.50
4 Western Ghat Development Programme 2.00
5 Modernization of Footwear Unit 0.50
6 Conversion of Soap Units 0.20
7 Hill Area Development Programme 1.50
8 Research and Development in Hand Made Paper Industry 0.15
9 Marketing and Development for conducting Exhibition,
Fashion Show etc.,
0.50
Total (B) Village Industries Scheme 13.35
C) Palm Products Industries Schemes
1 Modernisation of Neera Processing Units 0.15
2 Modernisation of Confectionery Units Madavaram 1.00
3 Implements for Processing of Palm Jaggery 0.10
4 Development of Palm Products under WGDP 0.20
5 Development of Palm Industry under EGDP 0.20
Total (C) Palm Products Industries Scheme including Palm
Industries
1.65
Total (A + B + C ) 70.00
630
IV. Handicrafts
The Handicrafts sector is of special significance in the country's
economy due to its contribution to employment generation and foreign
exchange earning through exports as well as retaining heritage and tradition.
There has been no census or study on the handicrafts sector in the State of
Tamil Nadu. There are about 30 crafts in the State. The following are major
crafts:
It is estimated that there are about 1.60 lakh artisans in the State. The
total production figures are not available but it is estimated that each craft
person produces crafts worth Rs. 40,000 to Rs. 50,000 per annum - the total
annual production would, therefore, be Rs. 600 to Rs. 800 crores.
The all India exports of handicrafts during 2000-01 was to the tune of
Rs. 6955 crores out of which the export from the 4 Southern States and
Pondicherry was only about 8%. Thus the volume of exports from the State is
poor, there is a lack of marketing facilities, lack of information and lack of
organised developmental activities in the State.
With the primary objective of promoting Handicrafts in Tamil Nadu and
also safeguarding the welfare of artisans engaged in various crafts, the Tamil
Nadu Handicrafts Development Corporation Limited was formed in the year
1973. The Corporation is engaged in Marketing, Production and Training of
artisans, etc. The Corporation with its 15 showrooms in Tamil Nadu and four
in other States provides regular marketing assistance for the products used
by artisans in Tamil Nadu. It has 8 Production Centres in different crafts
located at various places in the State. These production units apart from
production impart training to artisans in their respective crafts for a period of
one year. Apart from its normal marketing activities, the Corporation also
undertakes execution of temple orders in Andhra Pradesh, Karnataka States
for wood/ silver/ gold temple chariots, wooden temple cars, dwajasthambams,
temple and church bells, wooden vahanams, gold covering works, brass grills
for ‘Q’ lines, brass hundials, etc.
Ninth Five Year Plan Performance
An outlay of Rs. 20 crores was provided for Handicrafts Development
Scheme during the Ninth Plan period and a sum of Rs. 57.50 lakhs was
released during the Plan period. The above allocation was utilized for the
renovation of showrooms, opening of new showrooms and conduct of
exhibitions. The statistics in respect of units registered and employment
generated for Cottage and Handicraft Industries during Ninth Plan period are
as follows:
1. Stone and stone carving 6. Papier mache
2.Wood based and wood carving 7. Thanjavur Art Plate
3. Metal based (Bronzes & Brass) 8. Temple Jewellery
4. Lace and embroidery 9. Thanjavur Paintings
5. Natural fibres 10. Terracotta
631
Cottage Industries Handicrafts Industries
Ninth Plan Units
registered
Employment
generated
Units
registered
Employment
generated
1997-1998 6398 12318 4268 7283
1998-1999 4981 9164 3529 6266
1999-2000 7192 11465 4720 14160
2000-2001 7970 13337 5107 9093
2001-2002 7727 13041 4754 8152
Total 34268 59325 22378 44954
The production and sales during the Ninth plan period are as indicated
below:
(Rs. in lakhs)
Year Production(Value) Sales
1997-98 250.78 1094.42
1998-99 224.84 1141.84
1999-00 235.50 1281.52
2000-01 263.20 1372.07
2001-02
(projected) 280.00 1575.00
Total 125432 6464.85
Tenth Five Year Plan Outlay and Programmes
The Tamilnadu Handicrafts Development Corporation is serving as a
full fledged developmental and promotional agency for Handicrafts
Development, besides acting as a marketing outlet and trading corporation.
An outlay of Rs. 10 crores is proposed for Handicrafts for the Tenth Plan.
1) Ambedkar Hastshilp Vikas Yojana Scheme
The Government of India has recently launched Baba Sahib Ambedkar
Hastshilp Vikas Yojana Scheme which envisages promotion of Indian
Handicrafts by developing Artisans clusters into professionally managed and
self-reliant community enterprises. The Corporation has proposed to organise
clusters for stone and stone carvings, metal based craft, wood carvings and
wood based, Thanjavur Art plates, Thanjavur paintings etc., at a cost of
Rs. 2.50 crores initially for the Tenth Plan.
2) Urban Haat
Urban Haat on the pattern of Dilli Haat is proposed to be set up in
Tamilnadu, preferably around Chennai. Urban Haat will serve as a Tourist
Centre and establish a permanent Exhibition Centre for the Craft persons
which include cost of construction of hundred sheds at about Rs. 60 lakhs
and Rs. 30 lakhs for development of infrastructure. The land is proposed to be
obtained from Government free of cost. The outlay proposed for the Tenth
Plan is Re. 1 crore.
632
3) Design and Development Centre and Training
Three Design and Development Centres are proposed to be set up for
the major crafts - stone based, wood based, metal based. It is proposed to
construct three buildings at Rs. 1.50 crores and another Rs. 1.50 crores has
been proposed for staff and establishment charges. The outlay for Tenth Plan
will be Rs.3 crores for the above scheme.
4) Museum
A State Handicrafts Museum is proposed to be set up to provide a
link between the Traditional and Modern Crafts. The Madras Craft
Foundation, Dakshin Chitra one of the landmarks of traditional culture and
crafts of the South is already running a museum at East Cost Road at
Muttukadu , Kancheepuram District and the Museum will be strengthened
during Tenth Plan. An outlay of Rs. 30 lakhs has been proposed for Tenth
Plan.
5. Working capital requirements for direct procurement from Artisans
TNHDC showrooms, as part of their trading activities, are procuring
handicrafts for sales requirement directly from craftsmen according to
availability of resources. An outlay of Rs. 2.50 crores has been proposed as
working capital assistance during the Tenth Plan period .
6. Upgradation of Technologies Research and Designs
It is proposed to develop new designs and upgrade technology
during the Tenth Plan period. The scheme will have two parts. First part is
to depute persons to Design Centres for advanced training to acquire new
technologies and the second part is to invite the services of a designer to do
research and introduce new designs. Apart from the master craft persons
from the Corporations, production centres, outside craftsmen will also be
sponsored for two week programmes. 15 participants will be deputed each
year at a cost of Rs. 1.40 lakhs per year, of which Rs.12,000 towards faculty
charges and Rs. 60,000 transport charges for faculties are to be incurred by
the Design Centre on behalf of the Corporation for the artisans to be deputed.
Organising Design Development in three specific crafts will be the second
part of the training. An outlay of Rs. 43 lakhs has been proposed for this
programme for Tenth Plan.
7. Sanction of matching grant for construction of building for showroom at
Erode.
A showroom of the Corporation is functioning at Erode in rental
premises. The Corporation was able to get a land measuring about 2400
sq.ft. at a cost of about Rs. 4.75 lakhs. The total expenditure inclusive of cost
of land, construction and interior decoration comes to about Rs. 32.25 lakhs.
The State Government has already sanctioned Rs. 17.15 lakhs for the
purpose. An outlay of Rs. 12 lakhs has been proposed for this scheme for
Tenth Plan.
633
8. Sanction of matching grant for opening a sales outlet at Swamimalai
For construction of building for the production unit at Swamimalai,
Rs. 10 lakhs was sanctioned as a new scheme during 1998-1999 and for
establishment of a Design-cum-Training Centre for Bronze icons, a sum of
Rs. 10 lakhs was sanctioned during 1999-2000. Rs. 10 lakh had been
deposited with Public Works Department for construction purposes. Out of
Rs. 10 lakhs sanctioned during 1999-2000, the Corporation had utilised Rs. 7
lakhs for purchase of land and for construction of composite building. The
estimated cost of the building is around Rs. 74.25 lakhs. A sum of Rs. 15
lakhs was sanctioned towards opening a new sales showroom at
Swamimalai. Still, the Corporation requires about Rs. 46.25 lakhs for the
above works. Due to financial constraints, the Corporation was not in a
position to complete the work from its own resources. Hence, State
Government will have to provide a sum of Rs. 10 lakhs as matching grant for
opening a new sales outlet at Swamimalai during the Tenth Plan. An outlay of
Rs. 15 lakhs has been proposed for this scheme for Tenth Plan.
Tenth Plan Outlay (2002-07)
The outlay for the Tenth Plan for Handicrafts will be Rs. 10 crores. The
schemewise outlay is furnished in the Table below.
Handicrafts Sector - Tenth Plan
Rs. in crores
S. No. Name of the Schemes Outlay
1 Ambedkar Hastship Vikas Yojana 2.50
2 Urban Haat 1.00
3 Design and Development Centre and Training 3.00
4 Museum 0.30
5 Working capital assistance for direct procurement 2.50
6 Upgradation of Technologies, Research and Designs 0.43
7 Matching Grant for Construction of Building for showroom at
Erode
0.12
8 Matching Grant for Opening a Sales outlet at Swamimalai 0.15
Total 10.00
V. Sericulture
Sericulture is a rural industry having high employment generation
potential and provides substantial returns to the farmers with relatively low
capital investment. It is a labour intensive, agro-based industry providing
employment to about 62.5 lakh persons in the country. Sericulture generates
employment for 5 persons throughout the year per acre of mulberry garden. It
provides employment to rural women in maintenance of garden, transporting
of leaves, rearing of silk-worms, cocoon harvesting, cleaning of cocoons and
reeling of silk in pest-cocoon sector. This makes sericulture ideal for
generation of rural employment and income. This industry is concentrated in
the southern states of India viz., Karnataka, Tamil Nadu and Andhra
Pradesh. India stands as the second largest producer in the world after
China and Tamil Nadu ranks third among the silk producing States in the
country.
634
In Tamil Nadu acreage under mulberry has increased from 900 acres
in 1975 to 27,000 acres in April 2001. The production of cocoons and raw silk
have also correspondingly increased from 215 tons and 10 tons in 1956 to
5,138 tons and 672 tons in 2000 respectively. At present 47,000 farmers are
engaged in Sericulture. Further the industry provides employment to 1,00,000
persons directly and 35,000 persons indirectly in downstream activities of
reeling and twisting throughout the year.
Ninth Plan Performance
To maximise profit, shift from labour intensive methods to technology
intensive to reduce cost and improve quality and productivity is a must. In the
Ninth Plan, it was decided to address extension system as a group approach
to achieve shared goals and to concentrate in potential districts of
Dharmapuri, Vellore, Salem, Namakkal, Coimbatore, Erode and expansion of
mulberry in other districts under Catalytic Development Programme. It was
proposed to strengthen the market information system, develop more skilled
personnel through appropriate training, to use improved/ new technology to
improve degumming, dyeing and expose to designs, blending with other fibres
etc., to promote production and consumption. Efforts were taken towards
increasing the leaf yield to the desired level by promoting cultivation of
improved mulberry varieties like S1, S36, MR2, etc. Drip irrigation system
was popularised among the farmers. They were also educated to use
biofertilisers,
micro-nutrients, manure and chemical fertilsers and disinfectants to
improve the quality and productivity of leaf. Rearing of Bivoltine races like
CSR 18x19 was taken up. Human and Institutional Development was taken
up by organising Quality Clubs, training programmes, seminars and
demonstration camps to upgrade the skills of the farmers, reelers and
extension staff. Training of extention staff on Total Knowledge Management
was taken up. Sericulture was taken up under the Centrally sponsored
programmes like Hill Area Development Programme, Western Ghat
Development Programme and Integrated Tribal Development Programme.
The outlay for Sericulture for Ninth Plan period was Rs. 40 crores. Out
of this an amount of Rs. 3 crores was released which includes new schemes
for an amount of Rs. 1.40 crores and the balance was for Area Development
Schemes. To provide matching contribution to implement Catalyic
Development Programme assisted by Central Silk Board, a sum of Rs. 1.54
crores was sanctioned from Sericulture Development and Price Stabilisation
Fund. An external aided project Seri 2000 was implemented at a cost of
Rs. 1.32 crore. The total provision was Rs. 5.86 crores and the expenditure
was Rs. 4.86 crores.
Under Mulberry Expansion against a target of 24458 acres the
achievement during the Ninth Plan was 27941 acres. Under Layings
consumption, as against a target of 730 lakh Dfls, the achievement was 583
Lakh Dfls. Cocoon production which was targeted to be 33437 M.Tons was
28908 M.Tons in the Ninth Plan. Under Raw Silk Production against the
target of 3612 M.Tons the achievement was 3109 M.tons. For Employment
Generation, the target was fixed at 1,27,266 and against this the actual
employment generated was 1,39,210 Nos.
635
Sericulture - SWOT Analysis
Strength
1. Strong domestic demand - pull.
2. Comparative advantage such as large production base, availability
of land, labour.
3. Established infrastructure Technology
4. Strong Tradition.
5. Organised Co-operative weaving sector.
Weakness
1. Inconsistency in output quality.
2. Poor Technology Transfer.
3. Inadequate market linkages for silk sale.
4. Small and scattered production structure.
5. Thin margin.
6. Inadequate emphasis on quality.
Opportunities
1. Generates Rural employment.
2. Developed countries are withdrawing from production of required
silk slowly.
3. Receding production in China.
Threats
1. Falling international prices influencing local price.
2. Unpredictability of China's silk policy.
3. Shift faster to finer fabrics.
4. Falling capabilities of States to invest substantially.
Tenth Plan (2002-07)
A number of developments have taken place in recent years including a
major breakthrough in tropical Bivoltine Sericulture Technology. A total
package has been developed to control diseases of silkworms, a system to
reduce labour cost and new high yielding varieties for mulberry and silk
production have been developed. India produced 9500 tons in 1987 and
reached 14,432 tons in 2001 against the target of 18,954 tons by the end of
Ninth Plan. The approach in the Tenth Plan will be to improve productivity and
production substantially. The potential available having regard to the growing
demand in the global and domestic market needs to be tapped with right
investment.
Impact assessment of World Trade Organisation - There has not been
any significant fluctuation for cocoon and silk yarn productivity in the country
with removal of QRs with first April 2001. However future growth to a certain
extent depends on how the industry reacts on short, medium and long term to
the market changes that are sure to affect its competitiveness in the Post
GATT regime. Therefore the production of Indian silk must become more
technology intensive to increase productivity and income level of the farmer
through better technology packages, cost saving technologies and adoption of
high yielding varieties. The other area to be focussed upon is to reduce the
636
risk involved by offering packages with low investment and providing staff
support for disinfection against the disease outbreak.
Current demand within India is for about 22,000 tons of mulberry silk,
of which about 14,400 tons are produced indigenously. The supply gap is
mainly for warp grade silk which constitutes approximately about 42% of the
domestic demand preferred in powerlooms mostly of Bivoltine silk. Presently
the imported Chinese silk fills this supply gap.
Market Linked Production Planning - Cocoon produced in the State
continues to flow across the border to Karnataka and only around 50% of
produced cocoon is transacted. In case of silk, even the silk converted locally
is not transacted in Silk Exchange totally and the marketing organisation
TANSILK continues to procure 30 tons of silk from Karnataka to meet the
demand of organised sector. Therefore it requires co-ordinated intervention
and education of reelers to produce required quality and if production
continues without quality linked basis, silk reeling sector will continue to suffer
where the margin is thin. There is a need to link reeler and weaver to help
each other. Though silk accounts for less than 1% of world production of
textile fabrics its value is very significant in trade.
Breakthrough Technologies - With break through achievement in
production of Bivoltine cocoon demonstrated jointly by Central Silk Board and
Japanese International Co-operation Agency (JICA) in Tamil Nadu in Gobi
area of Erode district since January 2000, many farmers adopted
technologies developed to take up Bivoltine silkworm crops. In the year
2001-02, it was expected that 20 tons of Bivoltine silk would be produced.
The Tenth Plan should have two distinct production lines to meet internal
demand of yellow silk used in Handloom sector and Bivoltine silk for both
handlooms and powerlooms.
Production of Bivoltine silk requires co-ordinated intervention and it
involves higher investment for production of bivoltine as it involves facilities
like separate rearing shed, shoot rearing racks, proper effective disinfection,
ventilation, hygiene and quality leaves for rearing.
Growth of powerlooms forced to look for imported silk. The product of
handloom sector has been the saree. Of late demand for dress materials and
furnishing material in silk has opened up new possibilities. Already a good
part of the Chinese yarn is finding its way even into handloom products,
because bivoltine silk yarn is preferred as warp on account of its better tensile
strength. Therefore, production of Bivoltine silk is to be taken up.
Demonstration of Bivoltine Sericulture Technology jointly by scientists
of Central Silk Board and Japanese International Co-operation Agency from
2000 invited the attention of progressive farmers to take up bivoltine crops.
The Central Silk Board assisted schemes under Catalytic Development
Programme were revamped by (a) simplification of schemes, (b) widening the
scope and scale of assistance especially for the bivoltine programme, (c)
rationalising proportions in sharing subsidy by Central Silk Board and States
and weeding out schemes with low level of acceptancy.
China reduced its production of silk from a level of 79,000 M.Tons in
1995 to 56,000 M.tons in 2000.
637
New Textile Policy of Government of India - The New Textile Policy of
Government of India incorporates the following directives for silk:
1. Improving Research & Development and effective Transfer of
Technology at all stages.
2. Augmenting efforts for the spread of Bivoltine Sericulture.
3. Encouraging clustering of activities of reeling, weaving and
strengthen linkages between the producers and industry.
4. Periodically reviewing the import policy for raw silk taking into
account the interests of the Sericulturists and exporters.
Objectives
1. To increase productivity and income through adoption of new
technologies developed.
2. To create greater opportunities for gainful employment in rural areas
through spreading of Sericulture practices developed to reduce risks.
Production Targets
Considering the demand and supply pattern the production at the end
of Tenth Plan would be 1500 M. Tons of raw silk of which 300 M.Tons (20 %)
would be of Bivoltine silk.
Sl
No
Details
Unit 2002-03 2003-04 2004-05 2005-06 2006-07
12345678
I Layings
Consumption
a) Bivoltine
b) Cross Breed
Lakh DFLs
Lakh DFLs
10.18
154.00
14.00
165.00
19.09
174.18
31.82
187.91
38.18
220.00
Total 164.18 179.00 193.27 219.73 258.18
II Cocoon
Production
a) Bivoltine
b) Cross Breed
M. Tons
M. Tons
560.00
6930.00
770.00
7425.00
1050.00
7838.00
1750.00
8456.00
2100.00
9900.00
Total 7490.00 8195.00 8888.00 10206.00 12000.00
III
Silk Production
a) Bivoltine
b) Cross Breed
M.Tons
M.Tons
80.00
840.00
110.00
900.00
150.00
950.00
250.00
1025.00
300.00
1200.00
Total 920.00 1010.00 1100.00 1275.00 1500.00
Production Strategies
1. Replacement of existing varieties with high yielding mulberry varieties
like V1 and S54, S36, etc.
2. Assist farmers in building low cost rearing houses and to acquire
improved rearing equipments.
3. Production of Bivoltine eggs in specific grainage by upgrading facilities.
4. Train staff, farmers in Tropical Bivoltine Sericulture Technology and
5. Re-orient post cocoon support with special training programme in
specific areas.
638
Outlay
An outlay of Rs. 6.45 crores is proposed for the Tenth Plan for the
Sericulture Schemes.
Schemes
1) Mulberry – Planting of New Varieties
During the Ninth Plan, it was proposed to cover 45000 acres for
mulberry but as on 31.03.2002, 32,640 acres had been brought under
mulberry. To promote cultivation of high yielding varieties, it is proposed to
assist at the rate of Rs. 500/ acre to 5000 new farmers and others by
replacing the existing varieties. The total requirement is Rs. 500 × 5000 or
Rs. 25 lakhs for the Tenth Plan.
2) Drip Irrigation to conserve water
It is proposed to install drip irrigation system in 500 acres for which
subsidy will be provided at the rate of Rs. 17000/- for SC/ ST/ Women and
Rs. 13000/- for others. An amount of Rs. 6.90 lakhs is, therefore, provided for
the Tenth Plan.
3) Bivoltine Thrust Programme
To produce Bivoltine silk in the State, it is proposed to assist activities
such as Rearing Shed, Rearing Equipments, Disinfectants to P1 seed farmers,
assistance to establish multi-end reeling basins (Six end basin units and Ten
end basin units) and assistance to chawkie rearing centres with a State share
assistance of Rs. 383.64 lakhs, Central Silk Board Share of Rs. 417.65 lakhs
and Beneficiary share of Rs. 800.20 lakhs.
4) Seri-2000 (EAP)
The externally Aided “Seri-2000” programme funded by Swiss Agency
for Development and Co-operation implemented from 1998-99 onwards will
be continued during the Tenth Plan also. The established Sericulture Quality
Clubs (SQCs) will be strengthened with assistance for procurement of
effective compressor type power sprayer as well as financial assistance
towards purchase of inputs. An outlay of Rs. 152 lakhs has been proposed
for Strengthening of Quality Clubs and working capital assistance to Small
reelers through Sericulture Co-operative Societies with beneficiary share of
Rs. 41 lakhs and the remaining amount of Rs. 111 lakh will be the State's
share.
5. Capability Upgradation
In order to demonstrate Bivoltine Sericulture Technology, it is
programmed to expand this programme in the districts of Dharmapuri and
Erode during Tenth Plan. An outlay of Rs. 10 lakhs is proposed for the Tenth
Plan for training of staff in different institutes in Bivoltine rearing, chawkie
rearing, disinfection, pests and disease control, silkworm race maintenance
and for trainers' training and seed farmers training, etc.
639
6. Preparation of Extension and Publicity materials
It is proposed to avail assistance from Central Silk Board with matching
State's contribution to the tune of Rs. 4 lakhs during Tenth Plan for publicity
materials in local language and extension messages appropriate to farmers
and reelers.
7. Computerisation and Upgradation of existing facilites
To keep pace with development in MIS, upgradation and replacement
of system is a necessity. The National Informatics Centre, Chennai studied
the requirements of Silk Exchange to improve hardware, software support,
etc. A sum of Rs. 10 lakhs has been proposed to update MIS during the Tenth
Plan.
Area Development programmes
Sericulture is an agro-based industry in which tribals are engaged in
the hills. Sericulture is an important component in the Hill Area Development
Programme, the Western Ghat Development Programme and the Integrated
Tribal Development Programme. A total outlay of Rs. 89.90 lakhs is
proposed for Sericulture under these programmes for the Tenth Plan period.
The details are as follows:
(Rs. in lakhs)
(A) Hill Area Development Programme 11.78
(B) Western Ghat Deveploment Programme 58.50
(C)Integrated Tribal Development Programme 19.62
Total (A+B+C) 89.90
Central Silk Board Schemes for Tenth Plan
1. Reimbursement of 50 % of the cost of Mulberry saplings. (Cost Rs.
0.50/ sapling, Central Silk Board Share 50 %, State Share 50 %).
2. Assistance for procurement of Modern rearing equipments required
for Bivoltine Sericulture at a cost of Rs. 30,000/ farmer to cover
cost of improved mountages like rotary mountages, netrikas, shelf
rearing equipments etc. Cost is to be shared on 25 : 25 : 50 basis
by Central Silk Board, State and beneficiary.
3. Assistance to promote economic use of water through Drip
Irrigation system by sharing 50 % subsidy on 90 : 10 basis by
Central Silk Board and State respectively.
4. Supply of Quality disinfecting material for P1 (Seed), F1
(Commercial) Bivoltine farmers by sharing cost on 25 : 25 : 50 basis
by Central Silk Board, State and beneficiary.
5. Promotion of Chawkie Rearing Centres at a cost of Rs. 3 lakhs to
be shared by Central Silk Board, State and beneficiary on 25 : 25 :
50 basis (Rs. 1.00 lakhs on rearing shed Rs. 2.00 lakhs on
equipments)
640
6. Assistance for construction of separate rearing house by
sericulturists. Total cost upto Rs. 1.00 lakh/unit. Subsidy 50 % to
be shared by State and Central Silk Board equally.
7. Promoting establishment of Multiend reeling machines and provide
subsidy at 50 % to be shared by State (15 %) and Central Silk
Board (35%). (unit cost 10 Basin 10 End unit Rs. 6.28 lakhs) and
8. Working capital required for Multi end unit will be Rs. 3.50 lakhs.
The interest charged will be subsidised to the extent of 5 % by
depositing 50 % working capital sanctioned by Central Silk Board.
Tenth Plan schemes will be dovetailed to avail the assistance proposed
by the Central Silk Board.
Tenth Plan Outlay
In all, a total outlay of Rs. 19.97 crore is proposed for implementing
the Sericulture Schemes during the Tenth Plan, of which Rs. 6.45 crore will be
State’s share, Rs. 4.82 crore will be from Central Silk Board and Rs. 8.70
crore will be Beneficiaries' contribution/ Credit component. The abstract of
Tenth Plan Outlay and yearwise details for State’s Schemes are furnished in
Statements – I & II below.
Statement-I
Abstract Of Tenth Plan Outlay
(Rs. in crore)
Sl.
No
Details Total
Outlay
State
Share
Central
Silk Board
Beneficiary
/
Credit
1. Mulberry – Planting of New
varieties
0.25 0.25 - -
2. Drip Irrigation to conserve water 0.98 0.07 0.62 0.29
3. Bivoltine Thrust Programme 16.01 3.83 4.18 8.00
4. SERI-2000 1.52 1.11 - 0.41
5. Capability Upgradation 0.10 0.10 - -
6. Publicity Materials 0.04 0.02 0.02 -
7. MIS upgradation 0.17 0.17
8. Area Development Programme 0.90 0.90 - -
Total 19.97 6.45 4.82 8.70
641
Statement - Ii
Details Of Tenth Plan Schemes And Outlay
(Rs. in crore)
Sl.No Schemes Outlay
123
I
1.
2.
3.
4.
New Schemes (State plan)
Mulberry - Planting of New Varieties
M.I.S. - Upgradation
Capability Upgradation
Preparation of Extension Publicity materials in local
languages
0.25
0.10
0.10
0.02
II. Catalytic Development Programme
a) Installation of drip irrigation system
b) Construction of rearing shed
c) Procurement of rearing equipments
d) Supply of disinfection to P1 Seed farmers
e) Assistance to Multiend reeling
f) Establishment of Chawkie rearing Centre
0.07
2.50
1.00
0.06
0.25
0.08
III. SERI - 2000
a) Empowerment of Sericulture Quality
b) Provision of revolving funds to Sericulture Quality Clubs.
c) Exposure visit to Sericulture Qualtiy club members
d) Drudgery reduction to charka reelers
e) Awareness training to reelers
f) Working Capital assistance to small reelers
0.27
0.22
0.16
0.07
0.01
0.38
IV Area Development Programme
a) Hill Area Development Programme
b) Western Ghat Development Programme
c) Integrated Tribal Development Programme
0.12
0.59
0.20
Total 6.45
Abstract of Tenth Plan Outlay
Village and Small Industries
Sub-Sectors Outlay
(Rs. in crore)
1. Small Scale Industries under the control of department
of Industries and Commerce 83.55
2. Handlooms and Textiles 180.00
3. Khadi and Village Industrie 70.00
4. Handicraft 10.00
5. Sericulture 6.45
Total 350.00
642
Annexure
Problems / Issues in Handloom and Textiles Sector and recommendations /
suggestions (from Working Group's Report)
1. Census: There is an urgent need for a proper Census to be taken on the current
population of active handlooms and the type of looms, in the Co-operative sector and
otherwise.
2. Modernising the Looms: Various developments have taken place from pit looms to
frame looms and upgradation is necessary. For example, the 'pick and pick' looms
reduces the strain on the individual. Existing looms need to be replaced by modern
looms. Further, smaller frame looms need to be converted into wider width looms
for production of Export Varieties.
3. Designs and Innovations: A major strength of the Handloom Sector is that small
quantities can be produced and innovative designs can be introduced in a flexible
manner. However, the transfer of innovative designs to the handloom sector is not
fully integrated in a widespread manner. At present, the design and innovation field
in the Handloom Industry has not been strengthened. More stress on CAD / CAM /
Centres, tie up with NIFT /SITRA, etc. would need to be ensured. National Institute
of Fashion Technology (NIFT) should introduce a separate course on Handloom
Designing. The tie-up with Kalakshetra has been a novel experiment that has come
through quite effectively. Tapping on ethics sensitivities can help in marketing. All
other institutions with traditional arts & crafts could be worked into joint ventures.
4. Marketing: Marketing is a major factor affecting the future of Handloom Weavers
and this needs greater attention. Non-marketable varieties need to be identified
and discouraged among the Handloom Weavers. In order to compete in the Global
Market and to make the Weavers Co-operative Societies viable and also to give
continuous employment to the Handloom Weavers, the weavers should be
encouraged to resort to Export Oriented Production. The creation of a brand name
so as to give unique weightage to the 'hand weave' will go a long way. Societies
should market their products through their own sales outlets.
Specialised goods produced in particular region can be considered for
protection under the Geographical Indication of Goods Act 1999. The traditional
handloom varieties like Kancheepuram Silk Sarees, Bhavani Jamakkalam and
Madurai Sungadi Sarees should be protected under the Geographical Indication of
Goods Act 1999.
5. Training: Product Diversification needs to be given top priority. A major strength
in the State is production of furnishings, made-ups. More expertise is required in
understanding International trends, colour forecasts, design development etc. The
Karur, Erode, Chennimalai belt needs to be strengthened more with such avenues
for development. Silk furnishings have now acquired attention worldwide and this
would need a great degree of initiative as the orientation to these furnishings is quite
different. There are certain varieties in the State which are no longer marketable.
Lungies, Traditional Towels, Kora Sarees are having no longer good market. Such
products needs diversification. Fabrics which can be done on Powerlooms should be
discouraged on Handlooms.
Training programmes for punching of cards, exportable products in
collaboration with Weavers Service Centre are the need of the hour. Training
programme must be extended for use of tie and dye in Jamakalam weaving.
Massive training to the weavers to change the latest designs is absolutely necessary.
Cross-cultural visits of weavers to different weaving centres will help to expose them
to newer designs.
643
6. Cotton / Yarn: To face the quality conscious market, Co-operative Societies need
quality yarn. The Co-operative Spinning Mills are not in a position to respond to the
market need due to obsolete machinery etc. The fluctuations in quality, nonavailability
of equal grades of cotton and existence of old outdated machinery are
major problems facing the Co-operative Spinning Mills. Greater freedom in the
purchase of yarn from the open market will enable weavers Co-operative societies in
producing good varieties that would help sale in the open market.
7. Audit And Finance: The audit of the Co-operatives should be by a professional
agency. The cost of Co-operative audit is prohibitively high at present. Audit can be
done by Chartered Accountants (as has been done in Maharashtra State).
With regard to Co-operatives, the salary structure of the Coop. employees
and others should be made flexible according to the financial strength of the
Society. The co-operative by-laws may be made flexible in order to enable
engagement of an employee on contract whenever the financial position is weak.
8. Maintenance of Wage Levels: The Minimum Wages Act 1948 is being
implemented by the Labour Department. So far as the Handloom weavers in the
Weavers Co-operative Societies are concerned, the payment of minimum wages to
the weaver member of the Co-operative Societies besides allowing 10% D.A. hike
invariably every year in the light of the Government Orders is ensured. However, the
weavers outside the Co-operative fold are not paid 10% D.A. hike every year
resulting in a very large difference in the wage component between the weavers in
the Co-operative sector and the weavers working under master weavers. As a result,
the handloom products produced by the handloom weavers outside the Cooperative
fold are much cheaper than that of the goods produced in the Co-operative
societies. This affects gravely the saleability of the products of weavers Cooperative
societies. A wage policy needs to be evolved which pegs the upper levels
in tune to productivity & marketability of products in the weavers Co-operative
societies.
9. Legislative changes: A thorough overhaul of the Co-operative Societies Act to
incorporate provisions for taking remedial action and management of deficits in
stock, to eliminate bogus membership and for fast track provisions for clearance of
society's dues etc., is necessary.
10. The Handloom Reservation Act - 1985: To protect Handloom Weavers and the
Handloom Industry from the onslaught of Powerlooms, the Government of India
enacted the Handlooms (Reservation of Articles for Production) Act 1985 for
implementation by all States in the Country. In pursuance to the enactment of the
above Act, Rules and orders were framed by the Government of India by reserving
22 items exclusively for production in Handlooms. This was challenged by way of
several Writ Petitions before various State High Courts. All these Writ Petitions were
pooled together and heard by the Supreme Court of India. The Supreme Court of
India have dismissed all these Writ Petitions and upheld the reservation of 22 items
exclusively reserved for Handlooms.
A. Handloom Weavers' Co-operative Societies
Marketing is a major factor affecting the future of the Handloom Weavers Cooperative
Societies. Co-optex provides the major sales net-work for Weavers Cooperative
Societies in Tamil Nadu. However, it is in a position to market only about
25% to 30% of the products produced by Weavers Co-operative Societies. Ideally
Co-optex should be procuring atleast 75% of the product produced by Weavers
Cooperative
Societies. Co-optex is still having to cope with a traditional marketing
style which is proving difficult for the societies.
644
As a part of market strategy, the Department has recently started Showrooms
under the brand name "LOOM WORLD" which have been performing well at
Chennai Anna Nagar, Coimbatore and Erode. The Co-operative Societies have
been encouraged to market their products in 'LOOM WORLD" Show-rooms.
Exhibitions are being conducted under the brand name "LOOM WORLD" so as to
popularise the "LOOM WORLD" concept. "Loom World" should be progressively
strengthened and enabled to furnish production programme to Primary Weavers
Cooperative
Societies in a similar manner as that of Co-optex, so that Loom World will
market the remaining 25% of the products produced by Weavers Co-operative
Societies.
Every year, the Government has been issuing orders on D.A. hike on wages
for weavers working in the Co-operative societies and this is added to the product
costs. This has led to the products becoming unviable in the open market. Every
society should be given the freedom to determine wages according to its profitability.
Human Resources Development: Massive Training Programmes on improving
managerial skills & Computer skills should be given to staff manning the Societies.
In order to encourage the Handloom Weavers to upgrade their technology,
the Government have recently constituted a committee to work out a new scheme
and to suggest suitable schemes for upgrading the societies and converting them
into Powerlooms. A suggestion has been made that the Scheme of conversion of
Handlooms into Powerlooms introduced in the year 1991 and subsequently
withdrawn by the Government during the year 1996 may be re-introduced.
B. Spinning Industry
During 2002, the global demand is expected to touch 3200 million kgs. and
India could very well meet 25% of the demand. Thus, the spinning industry in Tamil
Nadu has 'market appeal' at the global level and this requires to be addressed in a
serious manner to ensure that mills which are functioning currently do not lend
themselves to closure on account of negative factors affecting them. Some of the
negative factors affecting the spinning mills industry in Tamil Nadu are
obscolescence in machinery, hank yarn obligation impinging on profitability, poor
quality of cotton, rigid labour laws, bias against large scale spinning mills and so on.
The following policy measures and steps can help modernisation, diversification of
yarn, quality maintenance and competitive pricing which in turn will ensure that Tamil
Nadu maintains its prime share in national textile capacity:
1. Hank Yarn Obligation: In real terms, there is a need to have a serious look at the
hank yarn obligation in the light of its current demand. The Hank Yarn Obligation
was meant solely to provide hank yarn for handlooms, but a substantial part of it is
being utilised by Powerlooms. An accurate Census would require to be carried out
on the actual usage of hank yarn for handlooms so as to reduce the Hank Yarn
Obligation. The Hank Yarn Obligation contributes in substantial measure to the
losses in the spinning mills.
2. Power -Power is an extremely important factor that affects the spinning mills.
The rate per unit in Kerala is Rs. 2.50 per unit, whereas, in Tamil Nadu it is almost
double. Several efforts are required to ensure that the power costs do not add up to
make the business unviable. The Industry has requested that HSD Oil for captive
power consumption in the mills should be provided with sales-tax concession /
exemption. Further, gas-based captive power plants should be given permission.
3. Labour: Labour is a major factor that adds to the costs, making any unit unviable.
Provisions of the Industrial Dispute Act, Tamil Nadu Industrial Establishment Act,
1981, Contract Labour Regulation and Abolition Act and Employees Provident Fund
645
Act need to be looked into so as to ensure greater productivity and viability of the
unit.
4. Taxes & Excise Duty: There is a need for an unbroken modvat chain from fibre to
fabric. Excise Duty would need to be further rationalised and brought down.
The State Government should encourage setting up of cone dyeing units
which will be the first step towards abolishing hank yarn. A specified period of time
may be given to set up Cone dyeing units and an incentive should be to give ST
exemption for a period of time (Cone dyeing units are not available in Tamil Nadu).
Incentives should be given to scrap old / obsolete industry. State financial
institutions which are providing funds for modernisation should encourage scrapping
of obsolete machinery as a precondition to access substantial finance. Buying new
machinery without scrapping old machinery is adding to the inefficiency in the
industry.
There is an urgent need for setting up Commercial Intelligence Cells to obtain
information on spinning industry in other countries.
Co-operative Spinning Mills: Out of 18 Co-operative Spinning Mills,
production was stopped by 4 Co-operative Spinning Mills due to fluctuations in
cotton and yarn rates, non-availability of working capital, wear and tear in the
machineries and recent recession in Textile Industry, etc., resulting in the Mills
sustaining huge loss. During the past few years, the Government had approved
various package measures for revival of all the Co-operative Spinning Mills in the
State. As the Central Co-operative Banks and NABARD have not come forward to
sanction cash credit continuously, almost all the Co-operative Spinning Mills
except Anna and Bharathi Co-operative Spinning Mills are running on huge losses.
In the first instance, the Government considered that the following 3 closed Cooperative
Spinning Mills be privatised by calling for bids
(i) Misereor Co-operative Spinning Mills
(ii) Madurai District Co-operative Spinning Mills
(iii) Villupuram District Co-operative Spinning Mills
Further, the Government ordered that the land and building of North Arcot
Co-operative Spinning Mills at Ariyur could be used for the setting up of a Medical
College and the other assets of this mill sold by calling for bids and the proceeds
utilised for Voluntary Retirement Scheme of workers.
The Government has constituted a Committee recently to decide on the
modalities of privatization. The Committee shall make its recommendations to the
Government.
With massive erosion of working Capital and networth, most of the CSMs will
need to be downsized or to be wound-up.
C. Powerloom Industry
1. Power: The cost and supply of power seriously affect the Powerloom Industry as
in the case of spinning mills industry. The cost of Powerloom is extremely high as
compared to neighbouring Andhra Pradesh and this is a major factor affecting
production costs. Further, erratic power supply also affects power schedules.
2. Low Level of Technology: Most of the plain looms in Tamil Nadu require to be
scrapped and replaced by Rapier looms or projectile looms. In fact, six plain looms
can be substituted by one rapier loom. A second hand rapier loom from abroad
would cost Rs. 15 lakhs. Technology has to be upgraded by scrapping of obsolete
646
machinery. Hence, it has been suggested that 25% Capital Subsidy can be provided
subject to a maximum of Rs. 3 lakh, for scrapping six plain looms in place of one
rapier loom or Shuttleless loom.
3. Credit: As in other sectors of the textile industry, real interest rates are very high
and there is scarcity of term credit. Producers have no other choice but to turn to
unorganised money markets. There is a need to make credit available at lower rates
of interest from financial institutions.
4. Powerloom Machinery manufacturers are conspicuous by their absence in India.
Auto/shuttleless looms require to be manufactured in India. This will help to bring
down the cost of shuttleless looms. In fact Powerloom manufacturers in Countries
such as Taiwan, Italy, Switzerland and Korea could be invited to set up industrial
units in the State.
5. Quality: Powerloom fabrics in India are comparatively poor in quality and this is
directly related to the technology. Training in quality control is absolutely essential.
The Powerloom Service Centres would need to be encouraged in popularising new
technology.
With regard to the import of modern looms, duty free import should be
encouraged where the technology is not available in the country.
6. Marketing Facilitation Centre: There is a need for provision of marketing
facilitation centres adjacent to powerloom clusters, that will enable buyers to have an
easy access to the producers. At present, buyers from abroad find it extremely
difficult to source the best in quality due to lack of a proper interaction centre.
Powerloom Development Export Promotion Council (PEDEXIL) can be involved in
setting up of interaction centre.
7. Processing: Processing is extremely weak and needs to be strengthened.
Processing units that are up-market and have modern technology need to be set up
in the State. The value addition after processing is very low and efforts have to be
taken to add value by improving processing quality like bleaching, dyeing, printing
etc.
8. Quotas: Preferential Quota distribution over the next three years should be linked
to Technology Upgradation. This will enable a real boost to efficiency and quality on
international standards.
Co-Operative Powerlooms and Assistance for Powerloom Sector: The need to draw
up a Scheme for upgradation of low value powerlooms into sophisticated
powerlooms in this State is highly essential. Towards this object, the Government
has constituted a committee recently to suggest suitable measures.
The Director of Handlooms and Textiles is functioning as the "State Textile
Authority" and is vested with the powers of enforcing Textiles (Development &
Regulation) order 1993. The Textile (Development and Regulation) Order 1993
came into force on and from 2.4.93. The issuance of Powerloom Registration
Certificate and its periodical renewal has been dispensed with and a system of filing
Information Memorandum and issue of an acknowledgement was introduced. The
fee for filing the information memorandum is Rs. 1000 (Rupees One thousand only)
irrespective of the number of looms covered under an Information Memorandum.
The fee of Rs. 1000 is to be paid each time to the Government Account (Powerloom
Registration Fund Account) whenever Information Memorandum is filed.
Powerloom Registration Fund: As empowered under the Textiles
(Development and Regulation) Order 1993, the Government constituted a
Powerloom Registration Fund and a Board of Management for it under the
Chairmanship of Secretary to Government, Handlooms, Handicrafts, Textiles and
647
Khadi Department. The entire amount collected for registration of Powerlooms have
been transferred to Powerloom Registration Fund. Further collections under the
registration of powerlooms are being credited to the above fund. This amount has
been deposited in the Banks as short-term deposits. This fund can be utilised for
providing loan assistance to the Powerloom Weavers Co-operative Societies, setting
up of powerloom centre, establishment of design centres for powerlooms, creation of
pre-loom and post-loom processing facilities, construction of godowns, opening of
showrooms for marketing of powerloom cloth, establishing research and
development centres, assistance for modernisations, etc.
The Powerlooms in Tamil Nadu are mostly unorganised and the Powerloom
productivity is very low. A programme of modernisation of these highly premitive
looms in a phased manner is the need of the hour. It has been suggested that loan
assistance may be provided from the Powerloom Registration Fund for
modernisation of 25,000 Powerlooms during Tenth Five year Plan period at 5,000
Powerlooms per year.
D. Garments Industry
Some areas that require immediate attention to sustain the growth are listed
below:
1. Rich raw material base in cotton and hosiery yarn production could be
wasted if the present level of technology is not upgraded. Upgradation of technology
can be made possible only if the latest developments in the field are available at
international prices.
2. Age restriction on import of advanced second hand machineries should
be liberalised wherever the latest technology is not available in India.
3. Crucial factor in determining the quality of garments is in the area of
embellishments, trimmings, zippers, etc. These are not available locally in India of
the required quality. Duty free import of these items will go a long way in improving
the quality and at the same time strengthening the industry at this crucial juncture.
4. Non-cotton export should be permitted to be imported freely (without duty).
5. A major factor affecting the garments industry including knitwear has been
the poor facilities for shipping at the Chennai port.
6. Efficient and transparent customs would be required to encourage exports.
With just 3 years to go for removal of quotas, it would be advisable for quota
distribution to be linked in some way to all units that have decided to upgrade their
technology.
7. An Apparel Park oriented towards ready made garments should be
located on the outskirts of Chennai to assist garment exporters here. This will greatly
encourage foreign buyers and importers from other countries to avail the excellent
boarding facilities in Chennai.
8. Research and Training facilities available at NIFT, NID, ATDC should be
enhanced with direct tie-up with foreign design and fashion institutions.
9. Uninterrupted supply of power and water in the industrial areas particularly
in the Ambattur belt will enable a greater thrust in these areas towards exports.
10. The State Finance Corporations should be encouraged to support
financing of investments in the garment sector through TUF and otherwise for
higher technology levels and the interest rates should be further reduced (link
between higher technology and lower interest).
648
11. Wherever triangle manufacturing systems are in operation with different
stages of the value chain being in different countries, it will help to identify the areas
that could be developed so as to bring the entire production process into one location
and thus directly be beneficial to the entire production process and stabilise the
industry being located in the State.
E. Knitwear Industry
In the context of globalisation, Indian Industrialists and Businessmen have
learnt that the bottom line is profitability and to this extent would ultimately relocate if
necessary. Therefore, the following aspects need to be looked into:
1. Electricity: Frequent interruptions, voltage fluctuations, unannounced power cuts
compounded with lack of proper maintenance on transformers has resulted in a
serious production problem for various units. The State that can manage good
supply of power will attract more industries.
2. Water: There are over 500 processing units with all of them being dependent on
water. The water problem in Tiruppur needs to be looked into immediately.
3. Chennai Port: Due to capacity constraints, very few mother vessels are able to call
at Chennai. The current practice of carrying cargo from Chennai in feeder vessels
with transhipment at Colombo, Dubai and Singapore entails delays. The capacity and
efficiency of Chennai Port should be augmented to work long haul mother vessels.
4. Apparel Park: An Apparel Park should be set up in between Tiruppur - Coimbatore
(easier access to export) to enable easy access for foreign buyers and visitors. This
will further help to attract more business opportunities. A minimum of 100 to 200
acres of land should be developed for this purpose.
F. Processing Industry
The developed countries have already begun regulating usage of chemical
dyes with eco-friendly measures like banning of AZO and other harmful dyes.
Setting up of Effluent Treatment Plants is absolutely necessary. To be recognised
worldwide, acquisition of ISO 9000 and ISO 14000 certification are important to
increase value additions and improve customer acceptability of the products.
Processing is the weakest link in Tamil Nadu textile production and there is every
possibility that this will weaken the sector so as to affect our brand image in the
future and lead to a greater loss of business. With this in mind, the following
measures are suggested:
1. Modern Processing units measuring to international standards and in a position to
meet environmental norms should be encouraged to be set up. Initially, subsidies
would be necessary either in the form of credit or loan to encourage them to set up
world class processing facilities and Corporates from abroad would need to be
invited to set up a few factories that would enable international quality. A major
incentive could be substantial Sales Tax exemption to encourage fresh investments
in this field.
2. The network of CAD/CAM computerised colour matching and testing facilities
would need to be explored.
3. ISO 9000 / ISO 14000 certification would need to be popularised. Seminars and
awareness drives by Business Associations are necessary.
4. Higher Interest subsidy would encourage greater development in the processing
sector. A subsidy of 15% investment in processing machineries, ETPs etc., would
help, alternatively interest free medium term loan can be contemplated.
649
5. As most of the units are involved in processing for garment units which are
already involved in exports, processing facilities should be encouraged irrespective of
whether it is in line with exports or not. Products sold within the Country will also
require to be of international quality in the light of globalisation.
6. Processing Industry catering to the needs of garment industry may be given
deemed export status which will encourage the industry to import quality machines
which are not manufactured in India without payment of import duty to meet
international standards.
7. A Corpus Fund has to be created for processing sector at State level.
8. Regarding pollution norms, Pollution Control Board instead of acting as a
regulatory authority should also act as a advisory body. While establishing Pollution
Control Board norms, discussion with industry and institution is necessary and proper
norms are to be formulated.
9. Wherever processing units are located there is a problem with regard to
hazardous solid waste. Land and seepage facilities should be provided for
depositing hazardous solid waste in such a manner as to be seepage proof.
10. Out of all 2200 processing houses, barely 20 are functioning to a satisfactory
level. It is estimated that a minimum of 30 to 40 processing houses with a capacity of
30,000 to 50,000 lakh sq. mtrs. are required depending on the sectoral products. A
massive promotional drive would be required to identify potential entrepreneurs who
are interested in setting-up world-class processing facilities. There is a need to
undertake a foreign tour by technical persons belonging to SITRA and financial
institutions to places in the world where the processing industry is highly developed
in order to set up top class units within the State.

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