Yarn Supply Scheme

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The Yarn Supply Scheme has three components, namely: (i) Supply of yarn at Mill Gate Price (ii) 10% Price Subsidy on cotton hank yarn, domestic silk, and wool; and (iii) Investment in NHDC

The Yarn Supply Scheme’s objective for the component is to make available all types of yarn at Mill Gate Price to eligible handloom weavers to facilitate a regular supply of basic raw materials to the handloom sector and help utilize the full employment potential of the sector.


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The agencies that will be eligible to avail of the benefits of the scheme will be as under:

a) All handloom organizations (including weaver co-operative societies) at the National/ State/ Regional/ Primary Handloom level.

b) Handloom Development Centres.

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c) Handloom producers/manufacturers exporting directly and registered with HEPC/ any other Export Promotion Council under the Ministry of Textiles/Director of Industries/Handlooms of State/U.T.

d) The Consortium/producers Company formed in the handloom clusters sanctioned under IHDS/IHCDS/Mega Clusters/Integrated Handloom Textile Parks.

e) Members of recognized/approved handloom associations.

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f) NGOs fulfilling CAPART norms.

g) Self Help Groups/ Joint liability Groups.

h) Individual weavers and Weavers entrepreneurs.

i) Any other agency approved by the Office of the Development Commissioner (Handlooms), Ministry of Textiles, Government of India.


  1. A 10% price subsidy on cotton and silk hank yarn will be provided upfront to the beneficiary agencies.
  2. The number of handlooms in each and every eligible agency will be verified by the State Directorate of Handlooms/NHDC.


  • All Handloom Development Centers
  • Handloom Organizations, including weavers’ cooperative societies at the National/State/Regional/Primary levels
  • Handloom manufacturers registered with the Export Promotion Council under the Ministry of Textiles or exporting directly
  • Individual Weaver entrepreneurs
  • Member of approved Handloom associations
  • Producers who are within the handloom clusters sanctioned under Mega Clusters or Integrated Handloom Textile Parks
  • Any other agency approved by the Office of the Development Commission (Handlooms), Ministry of Textiles

Application Process


  • These eligible agencies place their indents on NHDC.
  • A tie-up between NHDC and suppliers has been established.
  • A yarn passbook is given to first-user agencies to avail of the 10% subsidy.
  • This can be applied to the NHDC website. (https://www.nhdc.org.in/).
  • All types of yarn are supplied such as polyester, acrylic, rayon, jute, blended yarn, and zari. However, all of them are not eligible for a 10% subsidy.
  • The procedure of advance payment to precede indenting and supply of yarn (15 to 45 days) is waived for individual weavers and primary weavers’ societies.
  • National Handloom Development Corporation (NHDC) has opened distribution centers to introduce cash sales of yarns to them
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