In addition to VRS, some of the other investments eligible under the TUF to the extent necessary for the upgradation of plant and equipment includes: land and factory building including renovation of factory building and electrical installations, energy saving devices, effluent treatment plants, water treatment plants for captive industrial use and captive power generation.

As the name suggests, the main objective of this scheme is to promote technology upgradation in the textiles and the jute industry. The focus under the scheme is on technology upgradation in the existing units and setting up of new high-tech units. The aim is to bring about qualitative improvement in production, productivity and quality by adoption of highertechnology.

However, according to Kanshiram Rana, the industry can also use part of this fund for VRS.

Under the TUF, the cotton ginning and pressing units, jute industry and different segments of textile industry are covered. Technology upgradation under the scheme would mean induction of state-of-the-art or near-state-of-the-art technology.

However, step-up approach for the segments which are lagging far behind in the technology level is also permitted under the scheme. The technology levels are also benchmarked under the scheme in terms of specified machinery for each segment of the textile industry.

But, since the ultimate objective of the scheme is to upgrade the quality of the textile products, apart from specified textile machinery, certain other investments to the extent necessary are also eligible for funding under the scheme.

Such investment also include VRS for restructuring of the unit's manpower as a part of the technology upgradation project. However, interest reimbursement will not beadmissible on that part of the investment. (TUF scheme provide a reimbursement of five percentage point on the interest charged by the lending agency on a project of technology upgradation).

The upgradation could also include investments in the installation of in-house R&D including design studios, environment resource planning (ERP) and total quality management including adoption of appropriate ISSO/BIS standards.

However there is a condition that the total of such investments should not normally exceed 25 per cent of the total investment in such technology upgradation projects.