"Our initial outlay is Rs 25,000 crore to modernise the textile industry. This is not a limit. In fact, there is no limit for modernisation of the textile industry and banks are also willing," he said.

The much-awaited TUF was launched on April one to modernise the entire gamut of textile industry in an effort to prepare domestic units to face global competition in the wake of liberalisation and expiry of the Multi-lateral Fibre Agreement (MFA) in 2003.

Asked about the response from industry to TUF, he said the response was very good.

"About 300-400 units in Mumbai, 400-500 in Surat have all shown interest in TUF and got in touch with the banks. Response from spinning mills in south was also good," he said.

However, as this was the initial stageof the fund, it would take sometime for it to take off fully, the minister said, adding over-utilisation of a similar fund launched in 1987 for spinning mills' modernisation gave hope of tuf allocation exceeding the target.

Referring to government announcement in budget to allow stand-alone spinning mills to avail loans from the funds despite these units benefitting from the 1987 scheme, rana said the spinning sector had to be helped as it was starving for margin money now.

"However, there will no imbalances by spinning mills utilising the fund. We will rectify if any such imbalances occur," he said.

Under TUF, government would offer subsidy on interest to be paid by the industry on availing the loans from banks. The interest subsidy is likely to cost Rs 3,000 crore to the exchequer totally.

The minister said the high-level SR Sathyan committee would submit its report on a new textile policy in the "next few days".

"It will then require 1-3 months for thinking over the recommendations for thegovernment. But soon after getting the report, we will start deliberations with concerned ministry and try to implement it after the election," Rana said.

The Sathyam commission had been given a broad direction and it would try to give an impetus to handicraft, handloom, silk and jute industries.

Asked when the long-pending Cotton Technology Mission would be implemented, Rana said the Rs 600 crore mission was in the final stages of implementation and it would be launched soon.

To a question, Rana said government had been able to counter anti-dumping duty being imposed by developed nations on Indian textile products,.

"What should concern us is the quality of goods and cost of the products. That will help us to do better in the international market," he said.

On the export front, he said India might have achieved the $15 billion target for 1998-99.

"We may have also achieved the five billion dollar target for garment exports. But our yarn exports was hit by recession in south-east Asia ," hesaid.

Asked if government would consider any dilution of the statutory hank yarn obligation, he said the interest of poor handloom weavers had to be borne in mind.

As per the mandatory hank yarn order, spinning mills will have to produce 50 per cent of the yarn meant for domestic market in hank yarn form, which is meant for use by handloom weavers.

Spinning mills have been demanding dilution of the order pointing out that powerloom weavers were also making use of hank yarn.

"We have taken some measures already like exempting export-oriented mills from the obligation. We have done it for composite mills also. Otherwise, poor weavers interest is important for us," he added.