The government is soon expected to take up the proposal to increase the total fund sanction to Rs 15,000 crore for modernization of the textiles industry in the XIth Five-Year Plan. In order to promote modernization of textiles units in the country, the government subsidizes 5% cent of interest payments on loans sanctioned under the scheme.
The government had earlier earmarked 8,000 crore for this purpose, which was exhausted by June, 2010. Subsequently, the government had asked banks to suspend new sanctions under the Technology Upgradation Fund Scheme (TUFS) till allocation of additional funds was approved by the Cabinet Committee on Economic Affairs.
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