A working committee instituted for drawing up the policy may recommend sharp excise duty cuts on fabrics and lower import duties on textile-machinery parts.

The policy, a revamp of the 1985 policy, is also expected to suggest concessions for players at the lower-end of the powerloom and handloom industry, who cannot be integrated into the mill sector.

The working committee, set up under the chairmanship of former textile secretary S Satyam, is believed to be veering around to the view that segmental differences ought to be eliminated.

"We have had preliminary discussions with various industry representatives, and the discussions will continue for some more time. The current thinking among the committee members is that the disparties among different sectors must be eliminated," said a top ministry official who is also a part of the committee.

The committee is considering reduction in excise duties on fabrics by partly shifting them to yarn, which will relatively reduce evasion by independent processors.

The idea behind reducing the import duties on textile-machinery parts is to provide a major boost to the sector which is facing a bleak future, ministry sources said.

The committee is contemplating a slew of export boosters that will be determined after a thorough benchmarking excercise. It will study five fastest-growing textile-exporter countries and may include measures based on methods adopted by the nations, sources said.

The working committee has been meeting with the representatives of the textile industry over the last two weeks to elicit their views.

Since the textile industry has varied interests, the committee has found it difficult to arrive at a consensus. Though the committee has been given time till January to submit its report, it may be ready by the December-end, say sources. The textile ministry is expected to announce the policy by February after evaluating the recommendations of the panel.