IndiaFilings / Learn / Government Initiatives / Scheme For Integrated Textile Park Sitp
Scheme for Integrating Textile Parks (SITP) - IndiaFilings

Scheme For Integrated Textile Park (SITP)

To afford a world-class infrastructure and to build trust in the Textile Industry, the Indian Government has launched a Scheme for Integrating Textile Parks (SITP).

About the Scheme

In the year 2005, the Government of India launched the Scheme for the Integrating Textile Parks, by incorporating two Schemes:
  1. Apparel Parks for Export Scheme (APES) and
  2. Textile Centre Infrastructure Development Scheme (TCIDS)
Furthermore, the SITP scheme is a model illustrating a 'USER DRIVEN' approach, with independent possession of the Micro, Small and Medium Enterprises (MSMEs). The SITP Scheme enabled an establishment of more than 40 Textile Parks, yielded more than 3500 Crores and generated employment for 15000 textile workers.

Objective of the Scheme

  1. The scheme operates to provide funding for private entrepreneurs to construct textile units with all the world-class infrastructure features.
  2. Identify the well-groomed location for the Textile Units to meet the geographical, social and international standards.
  3. Bring considerable growth in the export rate.
  4. Generate huge employment opportunities.
The SITP project plays an effective role as a supporting cause in MSME development, as it routes to huge employment.

Eligibility Criteria

Ministry of Textiles has formulated a nodal agency to identify and monitor eligible projects and disburse the necessary funds to SPV. The SPV comprises of,
  1. Industrial Associations.
  2. Entrepreneurs Association.
  3. State Government Agencies that fall into the main promoters of the Integrated Textile Parks (ITP).
  4. The Special Purpose Vehicle (SPV), a corporate body registered under the Companies Act, is assigned for the execution of the ITP.
  5. A Special Purpose Vehicle (SPV) is formed at each ITP by the Representatives of Local Industry (RLI), State Industrial and Infrastructural Corporation (SIIC) and other bodies of GOI.
  6. The net worth of each promoter should not be less than 1.5 times their total equity proposed in the project.

Infrastructure Features of the Scheme

The Scheme actively involves in the tactical discussions targeting the Industrial Clusters with potential growth location for developing world-class infrastructure support. The Scheme will cover infrastructure, building for production and other supporting activities. The ITP includes the key elements below:
  1. SPV should have the land registered under their name.
  2. Infrastructure including drainage, water, compound wall, power, waste treatments etc.
  3. Plants & Machinery for the efficient production of ITP.
  4. Building
    • labs with equipment
    • training centres
    • canteen
    • hostel
    • offices
    • recreation
    • marketing support

Funding and its Distribution

  • The Funds are released in the form of Bank Loans and Grant/Equity by the Ministry of Textiles, State Industrial Development Corporation (SIDC) and Industrial Project Management Consultant (IPMC).
  • The Government of India releases the fund of Rs.40 Crores or the amount of 40% of the project budget, whichever is lesser.
  • Whereas, GOI supports with 90% of the project cost subject to a ceiling of Rs.40 crores for first two projects (each) in the States of Arunachal, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Tripura, Sikkim, Himachal, Uttarakhand and J & K.
  • The nominee of the SPV - Park is the responsibility of the Central Government.

Release of Funds

The release of funds from GOI to the SPV is generally done in three instalment ratios - 30:40:30.

First Installment

The first payment of 30% of the total share to SPV is subjected to the following:
  1. An equal amount of Bank Guarantee should be provided by SPV to the Ministry of Textiles.
  2. Formation of SPV
  3. Rendering the shareholders’
  4. SPV should possess the land considered for the Textile Parks in their name.
  5. Completion of all the formalities of all statutory clearances obligatory for the project initiation.
  6. Issuance of shares by SPV to members with respect to the area allocated to
  7. Opening of two bonded accounts (Trust and Retention accounts) in a nationalized bank.
  8. The Board of Directors comprising of one professional each from the Central and State.
  9. The Textile Commissioner is liable for the operation of these bonded accounts in terms of the Tripartite Agreement (TA).
  10. Project Approval Committee (PAC’s) approval certification.

Second Installment

The second payment of 40% of the total GOI share to SPV is subjected to the following:
  1. SPV should have incurred expenditure of their proportionate contribution, i.e., 70% of the total SPV share from all the sources.
  2. Submission of Utilization Certificate (UC) for the 1st instalment.
  3. Providing all the particulars about the equity.
  4. An authorization letter to be provided for Loan Section by SPV on availing of loans.
  5. The honour of contracts worth 100% of the overall project cost without the land.
  6. The Interest on the GOI grant will be refunded/attuned with a Bank Authorization Certificate for claiming the installment.
  7. Officer in Charge for the Regional Office of Textile Commissioner to authenticate the Progress report.
Note: The bank Guarantee issued by the SPV shall be returned only when the SPV equals the contribution amount to that of the third installment.

Third Installment

The final and the third payment of 30% of the total GOI share to SPV is subjected to the following:
  1. The 100% expense made by SPV share from all the sources.
  2. Successful completion of the entire infrastructure.
  3. The commissioning of 80% of the scheduled units with the fulfilment of 80% of the assured
  4. Submission of Utilization Certificate (UC) of the 2nd installment to claim for the final Installment.
  5. The Interest on the GOI grant will be refunded/attuned with a Bank Authorization Certificate for claiming the instalment.
Officer in Charge for the Regional Office of Textile Commissioner to authenticate the progress report along with the claim for release of the final installment.

Miscellaneous Expenditure Management

A budget not exceeding 2% of the yearly cost shall be issued for the Miscellaneous purposes.
  • For Administrative expenditure
  • Evaluation
  • Studies
  • Research & Seminars
  • Avoiding Information Leakage
  • Advertisements and
  • Employing an IT-enabled monitoring mechanism, etc.
ARNOLD T
Updated on: December 17th, 2019

Popular Post

Download ePAN Card – Get ePan from NSDL & UTIITSL
80 Small Business Ideas

Starting a small business can be a transformative venture, offering the exciting opportunity...

Nadakacheri – Income Caste Certificate Download Online in Karnataka
TDS Rate Chart for Financial Year 2025-2026 (Assessment Year 2026-2027)

Tax deduction at source, shortly and popularly known as TDS, was introduced by the Income Tax...

Divorce Rules in India: Everything You Need to Know
How To Download GST Registration Certificate Online?

Goods & Services Tax Certificate is issued to people who are registered under GST...

PAN Card Cancellation Online
Find Complete Details of GST Registration Procedure

GST registration applies to all individuals and entities supplying goods or services in India. GST...

Check Your PF Claim Status Online Using PF Tracking ID
Gift Tax in India: Applicability, Exemptions and Rules

Gift tax in India is applied when the value of the received gift exceeds ₹50,000 in the...

Check Your PF Claim Status Online Using PF Tracking ID
Old Regime vs New Regime 2025: Which Tax Regime is Better for You?

The Union Budget 2025 has brought significant changes to India’s personal income tax structure, raising the...

Check Your PF Claim Status Online Using PF Tracking ID
What is the minimum turnover for GST?

The Goods and Services Tax (GST) is an indirect tax system introduced in India in 2017. It functions...

Check Your PF Claim Status Online Using PF Tracking ID
How can I check if a trademark is registered?

A trademark search is simply checking if another person or organization does not already own the...

Check Your PF Claim Status Online Using PF Tracking ID
Section 194H of the Income Tax Act: TDS on Commission & Brokerage

Section 194H of the Income Tax Act in India mandates the deduction of Tax at Source (TDS) on commission or brokerage...

Check Your PF Claim Status Online Using PF Tracking ID
Section 80G Deduction - Income Tax Act

Section 80G Deduction is a facility available in the Income Tax Act which allows taxpayers to...

Check Your PF Claim Status Online Using PF Tracking ID
Crypto Tax in India: Taxation On Cryptocurrency

The Income Tax Department (ITD) has not provided specific guidance on crypto taxes for Indian investors. However...

Check Your PF Claim Status Online Using PF Tracking ID
Internal Audit Applicability Under Companies Act, 2013

Internal audit applicability is a critical concept for companies in India, impacting various...

Check Your PF Claim Status Online Using PF Tracking ID
Difference between Private and Public Company

In the business world, two main types of companies exist: private company and public company...

Check Your PF Claim Status Online Using PF Tracking ID
New GST Rules for Rent

Ministry of Finance vide a Notification No 05/2022- Central Tax (Rate) dated 13.7.2022 has issued...

Check Your PF Claim Status Online Using PF Tracking ID
GSTR-1 and GSTR-3B Due Date Extension - New Due Dates For January 2025

The Central Board of Indirect Taxes and Customs (CBIC) has recently announced an extension...

Check Your PF Claim Status Online Using PF Tracking ID
Different Depreciation Rates under Companies & Income Tax Act

Depreciation is a key concept in finance and accounting. It helps us manage how the value of...

Check Your PF Claim Status Online Using PF Tracking ID
Form 10IA - Section 80DD Deduction

Form 10IA of the Income Tax Department must be filed by taxpayers claiming income tax deduction...

Check Your PF Claim Status Online Using PF Tracking ID
GST on Used Cars: New 18% Tax Rate Explained

The Goods and Services Tax (GST) system in India has been a significant reform in the country's...

Check Your PF Claim Status Online Using PF Tracking ID
MSME Registration - Udyam Registration

India's Gross Domestic Product (GDP) benefits significantly from the substantial...

Check Your PF Claim Status Online Using PF Tracking ID
Section 43B(h) - New MSME 45 Days Payment Rule

The Finance Act, 2023 introduced the MSME 45-day payment rule under Section 43B(h) of the Income Tax Act...

Check Your PF Claim Status Online Using PF Tracking ID
Direct Tax Vivad Se Vishwas (DTVSV) Scheme, 2024

The Direct Tax Vivad Se Vishwas (DTVSV) Scheme, 2024, was announced by Union Finance Minister...