The Central Government has approved the special package for employment generation in leather and footwear sector. The package involves implementation of Central Sector Scheme "Indian Footwear, Leather & Accessories Development programme" with an approved expenditure Of Rs. 2600 Crore over the three financial years from 2017-18 to 2019-20. The scheme would lead to development of infrastructure for the leather sector, address environment concerns specific to the leather sector, facilitate additional investments, employment generation and increase in production. Enhanced Tax incentive would attract large scale investments in the sector and reform in labour law in view of seasonal nature of the sector will support economies of scale. The Special Package has the potential to generate 3.24 lakhs new jobs in 3 years and assist in formalization of 2 lakh jobs as cumulative impact in Footwear, Leather & Accessories Sector.
To boost employment generation and exports in the made-ups sector, the Government would provide an additional Capital Investment Subsidy (CIS) for made-ups units who have availed 15% CIS benefit under ATUFS based on the achievement of projected production and employment after a period Of 3 years. The period of 3 years will be counted from the date Of release Of ATUFS subsidy to the unit.
The made-ups units who have availed 15% CIS under ATUFS and fulfill the achievement of the production and employment generation after three years period as given below are only eligible for additional CIS under the scheme:
The production of made-ups made during the last 3 years is equal to or more than the expected production as per DPR and norms under GR (in accordance with the ratio given in the DPR subject to minimum investment to turnover ratio of 1:5.
The employment generation shall be in accordance with the employment figures given in the DPR subject to the minimum of the industry norm of 60 jobs per one crore rupees of investment (single shift working).
The additional subsidy shall be disbursed only after achieving the above two conditions at the end of the three years period.
3.1 Every eligible made-ups unit which has availed benefit under ATUFS will be paid an additional 10% Capital Investment Subsidy (CIS) on the eligible investment upto an additional maximum cap of Rs.20 crores. Thus, the total cap on subsidy for such a unit is enhanced under ATUFS from Rs. 30 crores to Rs. 50 crores (Rs.30 crores for CIS and Rs.20 crores for additional CIS respectively). This additional subsidy will be disbursed after a period of 3 years. This will be based on a verification mechanism linked to production volume, employment and turnover. The parameters for operationalizing the scheme will be as follows:
3.1.1. The production of the made-ups unit shall be in accordance with the ratio given in the DPR subject to minimum investment to turnover ratio of 1:5. In case Of an existing made-ups unit. the production of the unit shall be in accordance with the ratio given in the DPR subject to minimum additional investment to additional turnover ratio Of 1:5.
3.1.2 The employment generation shall be in accordance With the employment figures given in the DPR subject to a minimum of the industry norm of 60 jobs per one crore rupees Of investment.
3.2 Under ATUFS, there is a Joint Inspection Team (JIT) mechanism for assessing and certifying the eligibility and eligible subsidy amount. The JIT verifies thc machines installed under ATUFS. This mechanism will be utilised to assess the employment and production figures furnished by the units in Format - A.
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