The exceptionally growing 47-billion dollar Indian textile sector got a leg-up from the 2007-8 budget presented in Parliament earlier this week when Finance Minister Palaniappan Chidambaram announced a number of sops for it.

The most important incentives announced are continuation of the Technology Upgradation Fund (TUF) for another three years and the proposal to hike the allocation for the Fund from Rs 535 crore in the last fiscal (2006-7) to Rs 911 crore in 2007-8.

The apparel and textile sector has since long been demanding extension of the TUF tenure to stimulate investment for modernising and creating new capacities to reap the benefits of quota-free

international textile regime.

Welcoming the extension of TUF, Chairman of Cotton Textile Export Promotion Council Prem Malik said high cost of capital has been an important factor that inhibited technology upgradation.

Textile industry analysts said the TUF extension would help achieve the envisaged investments of Rs 1.94 lakh crore and creation of some 140 lakh jobs in the next three years.

With China going to be a member of World Trade Organization by the year 2008, extension of TUF, whose validity was supposed to expire this month-end, is being seen as a major supporting factor to cope with the competition from the dragon land, they said.

As per Textile Commissioner J N Singh, the total Indian market size of apparels and textiles is about 47 billion dollars including exports.