Government of India has given a green signal to allocate Rs 6000 crore package to back textile and apparels sector. Besides the financial aid, government has taken a quondam leap ahead to further support the sector by providing more flexible labour laws and financial incentives.
With this move, government is hoping to create one crore new jobs in three years, allure another Rs 74000 crore in investment and generate $30 billion in exports earnings. Elaborating on the move, Finance Minister Arun Jaitley said that the package will help in realising the true potential of generating employment in the textile and apparel sector. The thrust of the package is to make this labour-intensive industry cost competitive and achieve economies of scale, which can help it corner a bigger share of the global market.
The government will foot the entire 12 per cent of employer's contribution under the Employers Provident Fund Scheme for new hands hired by the industry and earning less than Rs 15,000 a month for the first three years. This is higher than the 8.33 per cent share borne by the government under the Pradhan Mantri Rozgar Protsahan Yojana (PMRPY). This will add up to a benefit of Rs 1,170 crore over the next three years for the industry.
The recent move has certainly fumed new energy into the industry and it is estimated that it will help the industry to escalate to reach new horizons. The industry is very happy, especially because of the labour reforms that have been initiated for the betterment. Measures like fixed-term employment and seasonal flexbility in labour laws will benefit the garment sector immensely, said Ashok G Rajani, Chairman , Apparel Export Promotion Council.