Cabinet approves Reforms to Boost Employment Generation and Exports in the Made-ups Sector

Circular No.ES/223/ 2016-17                                                        December 08, 2016       

To: Members of the Council

Sub:  Cabinet approves Reforms to Boost Employment Generation and Exports in the Made-ups Sector

Dear Member,

As you may be aware, the Government of India had vide its Press Release dated 22^nd June, 2016 approved a special package for the textiles & apparel sector to create new job opportunities, attract investments and to increase the country’s trade. The made- ups Sector is labour intensive which provides  employment on a large scale especially near the rural areas. The Council had represented to the Government and also took up this issue at various forums to include MMF Textile Sector under Textile Booster Package to create more employment generation.

The Council is glad to inform you that now the Union Cabinet has approved a set of reforms including simplified labour laws and technology upgradation vide Press Release dated 07^th December, 2016.

The following interventions have been approved in a time bound manner within the approved budget of Rs. 6,006 crore for the apparel package with the objective of creating large scale direct and indirect employment of upto 11 lakh persons over the next three years in the made-ups sector:-

1. Providing production incentive through enhanced Technology Upgradation Fund Scheme (TUFS) subsidy of additional 10% for Made-ups similar to what is provided to garments based on the additional production and employment after a period of 3 years.

2. Extension of Pradhan Mantri Paridhan Rozgar Protsahan Yojana  (PMPRPY) Scheme (for apparel) to made-ups sector for providing additional 3.67% share of Employer's contribution in addition to 8.33% already covered under Pradhan Mantri Rozgar Protsahan Yojana (PMRPY) for all new employees enrolling in EPFO for the first three years of their employment as a special incentive to Made-ups sector

3. Extension of Rebate of State Levies (ROSL) (for apparel) Scheme to made-ups sector for enhanced Duty Drawback on exports of Made-ups.

4. Simplification of labour laws:

1. Increasing permissible overtime up to 100 hours per quarter in Madeupsmanufacturing sector,
2. Making employees' contribution to EPF optional for employees earning less than Rs 15,000 per month.

The above interventions are expected to boost employment in the textile sector and create employment, lead to increase in exports and enhance benefits to the workers in the textile and apparel sector. 

The Council will be issuing a circular informing about the future developments on this matter in due course.

Thanking you,

V. ANIL KUMAR
EXECUTIVE DIRECTOR