Entrepreneurs in the textile hub of Surat are caught in a very tricky situation on whether to continue with their projects because the Ministry of Textile is yet to disburse a whopping Rs 1,400 crore worth of capital subsidy amount to the textile entrepreneurs of Gujarat, especially of small-scale units (SSIs), in the city since December 2009.

According to the media report the small-scale units in the weaving sector can afford to install costly powerloom machines such as Rapier and Water Jet due to the 20 per cent capital subsidy sanctioned under the Technology Upgrdation Fund Scheme (TUFS) scheme.

A couple of years ago, the machines were imported from China and Korea, but now they are manufactured in India at a cost ranging between Rs 2.5 lakh and Rs 5 lakh.

In Gujarat alone, the Ministry of Textiles has approved 12,862 applications for projects worth Rs 18,841 crore under TUFS from April 1999 to December 2009. The total capital subsidy amount for the period was Rs 8,106 crore against which the government disbursed Rs 6,671 crore to the textile entrepreneurs.