Two of the country’s leading textiles and clothing companies, Aditya Birla group’s Grasim Industries and Arvind Ltd, have lined up fresh investments in Gujarat totaling Rs. 4,400 cr, giving a major boost to two recent policy decisions by the State Government.

“The Gujarat Government had in September decided to extend its textile policy by a year as its five-year duration got completed. In October, Gujarat unveiled a new policy specific to the garments and apparels sector. While Grasim’s projects will bring big investment, Arvind’s projects will help the government get closer to its goal of job creation,” said a Senior State Government official on condition of anonymity.

Grasim Industries on recently signed an agreement with the Gujarat Government to invest Rs. 4,100 cr for setting up two factories, one of which will come up on Gujarat Industrial Development Corp. (GIDC) land in Bharuch District while the other will come up in Surat, according to a State Government release.

A spokesperson for Grasim Industries confirmed that the company had signed agreements with the Gujarat Government for setting up two factories. Grasim’s plans come close to the State Government’s decision to extend its Textile Policy 2012, which ended in September this year. The policy that offers sops and other incentives to textile manufacturers has been extended by a year.

Grasim aims to set up man-made fibre facilities in the State and will employ about 1,300 people for the two factories, one of which will be commissioned in 2018, while the other will be operational in 2020, according to the government release.

Gujarat is a leader in cotton production. It is also a hub for textile manufacturing in the country, with 2.5 mn spindles installed. In a separate announcement, Arvind Ltd said in a statement recently that it has entered into an agreement with the Gujarat Government to set-up a “mega apparel factory.”

The Rs. 300 cr project will come up at Dehgam in Gandhinagar District with a capacity to produce 24 mn garments once it is fully operational, the company said in a statement. The company said that its decision comes on the heels of the new apparels and garments policy announced by the government earlier in October. The new Apparels and Garments Policy 2017 that was unveiled by Chief Minister Vijay Rupani on 11 October is expected to draw investments to the tune of Rs. 20,000 cr and provide jobs to about 100,000 people.

Under the new policy, the government will provide incentive for garment unit owners for generating employment by providing subsidy in wages. A special provision has been made in the policy wherein women workers will be paid `4,000 per month and male workers will be paid Rs. 3,500 per month. This promotion of assistance will be for a period of five years. Other incentives in the policy include subsidy in interest, exemption of stamp duty and partial relief in electricity duty.

In a statement, Kulin Lalbhai, Executive Director of Arvind, said, “We plan to Commence Commercial production in the fourth quarter of 2018 and we plan to create 10,000 jobs, a majority of which will be women. We are excited to support the Gujarat apparel policy whose aim is to create 100,000 jobs in Gujarat. We are confident that with such a conducive policy Gujarat will emerge as a major destination for garmenting.”