Objectives of IPDS
Major
objectives of the Integrated Processing Development Scheme are:
- To
promote the textile sector so that it becomes competent on a global level.
- To
facilitate the usage of eco-friendly technology in textile processing.
- To
help textile processing units to meet environmental standards fixed by
various agencies of the government.
- To
encourage Research & Development (R&D) activities geared towards
innovative and clean technology.
- To
create new processing parks and upgrade existing ones for better
productivity.
IPDS has
these focus areas:
- Adequate
and timely supply of water
- Wastewater
management
- Safe
treatment of effluents before disposal
Special Purpose Vehicle
- For
each project that gets approved under the Integrated Processing
Development scheme, a Special Purpose Vehicle (SPV) will be established
for implementation purposes.
- It
shall be a corporate body registered under the Companies Act.
- The
SPV will function under the guidelines mandated by the government but will
have operational autonomy.
- It
shall be collectively owned by
- Industrial
units undertaking processing in the park
- Financial
institutions
- State
government
- Central
government
- SPV
shall procure the land for setting up the processing park. The cost of the
land is not included in the total cost of the project, and therefore not
eligible for financial assistance under IPDS.
- It is
responsible for obtaining bank loans to set up processing units within the
park.
- Maintenance
of the facilities of the processing park fall is the responsibility of the
SPV, which will also collect user fees for the same.
- SPV
will also take care of any licenses or permits required to set up common
facilities in the park.
Agencies Involved and Implementation Strategy
Apart from
the SPV, various other agencies are involved in the implementation and
overseeing of the performance of Integrated Processing Development Scheme.
- Project
Management Consultant (PMC): This is an advisory panel appointed by the
Ministry of textiles for assistance in the assessment of proposals,
utilisation of funds, and monitoring the project progress.
- Project
Scrutiny Committee (PSC): This body shall be headed by Joint Secretary to
the Ministry of textiles. After submission to PMC, it will appraise the
proposals for feasibility.
- Project
Approval Committee (PAC): The Secretary to the Ministry of Textiles will
be the head of this body. It is meant to offer administrative support to
IPDS.
- Project
Management Agency (PMA): Post approval from the PAC, the SPV will appoint
a PMA for preparation of project plan and other implementation assistance.
- Respective
state government for assistance with approvals, suitable land, labour and
any other relevant schemes.
- Operation
& Maintenance (O&M) agency: It is responsible for the professional
maintenance of the assets of SPV for a period of at least 15 years.
Formulation of Project Proposal
- The
project proposal shall be made in consultation with PMC, post conduction
of diagnostic study assessing the requirement of infrastructure and other
facilities.
- Based
on the location of the park, PCB and environmental norms regarding water
supply or waste disposal may differ. The proposal must be framed based on
local guidelines.
- Choice
of technology for the processing parks must be chosen based on the
following criteria:
- BAT
or Best Available Technology that already has a proven track record
- Approval
of technology by an independent agency or the relevant PCB
- Reasonable
cost for effluent treatment strategies
- Proposals
must also include an effective technique for waste sludge management.
Quantum of Assistance
The SPV
will finance the project based on funds from the following sources:
- Equity
from members of the industry
- Grants
from the Ministry of Textiles
- Financial
support from the state government
- Loans
from banks and other financial institutions
- The
SPV will receive the government funds for the project through a Trust
& Retention Account (TRA) of any nationalised bank.
Financial
assistance under the scheme is subject to certain conditions:
- Land
cost is excluded from the total project cost
- Central
government grant is only meant for capital costs and not for land
acquisition
- The
central government will not be liable towards time or cost overruns
- The
Integrated Processing development Scheme does not cover retrospective
funding
- Recurring
costs, operation and maintenance charges are also not covered by IPDS
Once the
project becomes operational, the SPV has full discretion to fix user charges
for facilities of the park. O&M charges must be fully recovered through
such fees.
Criteria and Pattern of Fund Release
- The
central government grant will be released in three instalments.
- The
first instalment is 50% of the total grant from the central government,
which will be released after the fulfilment of the following criteria:
- Setting
up of SPV, with one GoI representative and one PMC representative on the
board of directors
- Land
procurement, issuing of shares to members, and completion of
shareholders’ agreement
- Establishment
of TRA in any nationalised bank
- Submission
of DPR (Detailed Project Report) to the Ministry of textiles, validation
of the same by PMC and approval from PAC
- Confirmation
from PMC regarding above-mentioned points
- Approval
from relevant state PCB and environmental clearance for the project
- Acceptance
letter from the state government for 25% contribution
- The
second instalment is 30% of the grant and shall be released after the
following conditions are satisfied:
- Utilisation
certificate for the first instalment issued by statutory auditors of SPV
- Release
of state government’s share of 25% of the total project cost
- Awarding
of all contracts equivalent at least to the total project cost which does
not include the land cost
- The
third and final instalment consists of the remaining 20% central grant
will be released three years after the project has become operational, and
utilisation certification has been issued for the previous instalment.