Textile Industry under Technology Upgradation Fund (TUF)

This scheme is administered by the Ministry of Textiles, Government of India. The original TUFS was launched on 1 April 1999 to modernise and upgrade the technology base of the textile industry in India. Over time this has been revised through variants such as Modified TUFS, Restructured TUFS, Revised Restructured TUFS and finally the Amended TUFS notified from 13 January 2016. The purpose is to enable textile and apparel units to upgrade to benchmarked machinery, improve productivity, quality, employment, boost exports, and reduce import dependence. By your business availing this scheme you stand to benefit from subsidised capital investment in modern technology.

Key Features
Financial Assistance
Eligibility Criteria
Documents Required
Application Process for the Scheme

Key Features

Capital Investment Subsidy for benchmarked machinery: Under ATUFS you receive a subsidy on the fixed capital investment made in new, benchmark machinery. This offsets part of your cost of modernisation.
Different subsidy rates and ceilings depending on segment: For example, for garmenting and technical textiles the subsidy under ATUFS is 15% of eligible machinery investment, subject to a ceiling of ₹ 30 crore per entity. For weaving with new shuttle-less looms, processing, jute, silk and handloom sectors the rate is 10%, subject to ceiling of ₹ 20 crore. Composite units have subdivided criteria depending on whether garmenting/technical textiles portion is more than 50% of project cost.
Coverage across textile value-chain segments: The scheme is not just for one segment; it supports weaving preparatory/knitting, processing of fibres, yarns, fabrics, garments & made-ups, technical textiles, handloom, silk, jute. This wide coverage means you as an MSME in any of these sub-segments may be eligible.
Credit-linked investment requirement: The ATUFS subsidy is available for investments where term-loan is sanctioned by a lending agency for purchase or installing benchmarked machinery. That means you need to have financing in place and machinery procurement/installation linked to that.
One-time capital subsidy per individual entity: The subsidy is available one-time for each eligible entity under ATUFS, subject to the ceiling. This means you must plan carefully the aggregate investment you claim for.

Financial Assistance

Component	Assistance Provided	Detailed Explanation & Example
Capital Investment Subsidy for Garmenting / Technical Textiles	15% of eligible machinery investment, up to ₹ 30 crore per entity	Example: If you invest ₹ 100 crore in new garment/technical textiles machinery and meet the benchmark criteria, you may claim subsidy of 15% of ₹ 100 crore = ₹ 15 crore and since this is less than ceiling ₹ 30 crore, you can avail that.
CIS for Weaving or processing or jute or silk or handloom	10% of eligible machinery investment, up to ₹ 20 crore per entity	Example: If your weaving unit invests ₹ 50 crore in eligible new machinery, you can claim 10% of ₹ 50 crore = ₹ 5 crore .
CIS for Composite Units / Multiple Segments	Either 10% (if garmenting/technical textiles portion <50%) or 15% (if >50%) subject to ceilings of ₹ 20 crore or ₹ 30 crore respectively	Example: Your manufacturing unit does processing + garmenting where garmenting portion is >50% of cost, and invests ₹ 60 crore in eligible machinery: you then qualify for 15% of ₹ 60 crore = ₹ 9 crore (ceiling ₹ 30 crore applies).

Eligibility Criteria

Who can apply:

New textile units or existing textile manufacturing units making investment in benchmark machinery as per scheme norms.
Units must be registered under relevant norms and secure project finance through a lending institution (since the subsidy is credit‐linked).
Investment should meet the definition of “eligible capital investment” and should use machinery from the approved list (bench‐marked machinery list) as per scheme guidelines.

Who cannot apply:

Units that do not utilise benchmarked machinery or do not invest through sanctioned term‐loan/credit as per guidelines.
Units that fail to comply with registration or finance norms .
Projects commenced before scheme approval or without meeting investment threshold or benefit eligibility may be disqualified.
Subsidy claims not meeting documentation/verification norms may be rejected or subject to recovery.

Documents Required

Term-loan sanction letter .
Project cost estimate, machinery list , quotes/invoices.
Registration of unit , PAN, GST number, Udyam registration if applicable.
Application on i-TUFS portal with UID generated.
Post‐installation: joint inspection report, invoice of machinery, Proof of installation, ledger evidences, certificate of utilisation.
Bank account details for subsidy disbursement.
Any state‐government approvals/clearances if applicable .

Application Process for the Scheme

Option 1: Apply with Bullit

Click here to start with guided support. Our team verifies eligibility, compiles documents, and handles application & follow-ups on your behalf. You can monitor progress while focusing on operations.
Recommended for: Textile manufacturing units seeking to modernise and upgrade technology efficiently.

Option 2: Government Process via Ministry of Textiles / Office of Textile Commissioner

The textile unit identifies eligible machinery as per the benchmark list under ATUFS.
Secure term‐loan / project finance from an approved lending institution.
Register the project on the i-TUFS portal and obtain a Unique Identification Number .
Submit required documents including loan sanction, machinery details, project cost, etc, via the portal and to the Office of the Textile Commissioner.
Post‐installation, joint verification/inspection of assets and submission of claim for subsidy. Subsidy credited as per approved project cost and rate.

Option 3: Via Nodal Bank / Lending Agency Assistance
Many lending banks act as nodal agency for the subsidy – the unit may coordinate through the branch or lending institution which helps process TUFS application along with term loan.