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LATEST NEWS UPDATES | Package to benefit 3 lakh handloom weavers: Sharma by Aarti Dhar

Package to benefit 3 lakh handloom weavers: Sharma by Aarti Dhar

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published Published on Dec 20, 2011   modified Modified on Dec 20, 2011

The Rs.3,884-crore package for the handloom sector, which includes one-time waiver of overdue loans and interests, approved by the Union Cabinet, is expected to benefit about 3-lakh weavers and 15,000 cooperative societies, which would have access to institutional credit once again.

However, the package will benefit only those who took loan before March 31, 2010. “There would be many weavers who had no access to institutional credit in the past and who would not be covered under the package,” Commerce, Industry and Textile Minister Anand Sharma told the Lok Sabha on Monday.

Making a suo motu statement, Mr. Sharma said a need was also felt to provide yarn to the handloom sector at a price cheaper than that for powerlooms and mills to face competition.

“In order to address the two critical needs of cheap credit and cheap yarn, the government has now approved a comprehensive package for handloom weavers. The intervention will be operationalised by modifying the existing Integrated Handlooms Development Scheme for extending cheap credit, and Mill Gate Price Scheme for supply of subsidised yarn.”

For this, the government would provide a margin money assistance of Rs.4,200 per weaver, their self-help groups and joint liability groups to enable them get fresh loans. An interest subvention of 3 per cent per annum for three years from the date of first disbursal would also be provided so that weavers and their cooperative societies could get loans at a subsidised rate of interest. Importantly, the loans extended by the financial institutions to the handloom weavers and their cooperative societies would be guaranteed for three years by the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). The government would pay the required guarantee fee and annual service fee.

On yarn supply to the handloom sector, a 10 per cent price subsidy on silk and cotton hank yarn would be provided. The government had decided to enhance the freight reimbursement for transportation of different types of yarn used by the handloom sector to offset the increase in fuel cost.

This would ensure availability of yarn in the handloom clusters in far-flung areas at roughly the same price that was available at yarn manufacturing mills.

The Hindu, 20 December, 2011, http://www.thehindu.com/todays-paper/tp-national/article2730253.ece


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