Labour-intensive textile sector, MSMEs to get new schemes
M. Soundariya Preetha
COIMBATORE
Labour-intensive textile and apparel and Micro, Small and Medium-scale Enterprise (MSME) sector impacted by geopolitical developments in the last two years received a boost from the Budget with new schemes and higher allocations.
Jump in allocation
The textile sector will see almost a 25% jump in budgetary allocation for 2026-2027 from the current financial year while the MSME sector will see doubling of allocation.
Union Finance Minister Nirmala Sitharaman said Central Public Sector Enterprises would establish high technology tool rooms in two locations as digitally enabled automated service bureaux that locally design, test and manufacture high-precision components at scale and at lower cost.
A Scheme for Enhancement of Construction and Infrastructure Equipment would be introduced to boost local manufacturing of high-value and technologically-advanced equipment.
A sum of ₹10,000 crore would be allocated during the next five years for a scheme for container manufacturing.
For the ‘labour-intensive textile sector’, the government proposed comprehensive measures that would include a special programme to promote sports goods, a National Fibre Scheme for man-made fibre, silk, wool, etc., mega textile parks developed on challenge mode for value addition to technical textiles, a Textile Expansion and Employment Scheme to modernise traditional clusters with capital support for machinery, technology upgradation and common testing and certification centres.
A National Handloom and Handicraft programme would ensure targeted support for weavers and artisans. Mahatma Gandhi Gram Swaraj initiative would boost khadi, handloom and handicraft, Tex-Eco Initiative would promote globally competitive and sustainable textiles and apparel and Samarth 2.0 would upgrade the textile skilling ecosystem.
Under rejuvenation of legacy industrial clusters, the budget proposed a scheme to revive 200 legacy industrial clusters, create dedicated ₹10,000 crore SME Growth Fund to create future champions and top up the Self-Reliant India Fund set up in 2021 with ₹2,000 crore to enable micro units access risk capital.
Settlement platform
The TReDS (Trade receivables discounting scheme) would be a mandatory transaction settlement platform for all purchases from MSMEs by CPSEs. A credit guarantee support mechanism would be introduced through CGTMSE for invoice discounting on TReDS platform; GeM would be linked with TReDS and TReDS receivables would be introduced as asset-backed securities, helping develop a secondary market.
