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‘Abolition of AIHB in consonance of minimum government, maximum governance’

  • Category
    Polity & Governance
  • Published
    22nd Sep, 2020

The Union textile ministry recently abolished the All India Handicrafts Board, Handloom Board and the Power Loom Board in consonance with the government’s vision of minimum government, maximum governance.


The Union textile ministry recently abolished the All India Handicrafts Board, Handloom Board and the Power Loom Board in consonance with the government’s vision of minimum government, maximum governance.

The ministry also changed the status of the eight Textile Research Associations to “approved bodies”, instead of the earlier “affiliated bodies”.


  • It was in 1950, in a newly independent India that Prime Minister Jawaharlal Nehruhad invited noted cultural and handloom activist Jayakar to study the handloom sector and work out plans for its revival.
    • Eventually, she served as chair of the All India Handloom Board and Handicrafts and Handlooms Export Corporation.
    • Jayakar also founded the National Crafts Museum in 1956. The board also has an imprint of Chattopadhyay, who was the driving force behind the renaissance of Indian handicrafts and handlooms post-independence.
    • She was instrumental in establishing the All India Handicrafts Board and the Central Cottage Industries Emporia.
  • The All India Handloom Boardwas set up in 1992, to advise the Government in the formulation of overall development programs in the handloom sector.
    • It was also responsible for advising the Government on how to make handlooms an effective instrument for reducing unemployment and underemployment, and how to achieve higher living standards for weavers.
  • The board soon became a leading voice for the revival of Indian handloom and handicrafts.
  • Thereafter, the All India Handloom Board has been reconstituted from time to time.
  • As India celebrated the National Handloom Day on August 7 2020, this was the first time it does so without the All India Handloom Board.


What are Autonomous Bodies?

  • Autonomous bodies (ABs) are a major stakeholder in the government’s functioning as they are engaged in diverse activities, ranging from-
    • formulating frameworks for policies
    • conducting research
    • preserving the cultural heritage
  • Institutes imparting technical, medical and higher education fall in this category.
  • Most of the ABs receive money from the Central Government by way of grants-in-aid (GIA). Since 2016-17, the Union budget accounts for the GIA figures to ABs separately.
  • As per statement no. 24, 2017-18 (revised estimates), the amount disbursed to autonomous/grantee bodies was Rs 799.55 billion, which, in 2019-20, was increased to Rs 943.84 billion.
  • These ABs employ a sizeable number of people as well. The apex administrative body of ABs is called governing council or governing body and is chaired by the minister or the secretary of the respective ministry.
  • Besides, the ABs have specialised committees such as the purchase committee, works committee, finance committee, with nominated ministry officials.
  • These ABs are audited by the Comptroller and Auditor General (CAG), and the annual report is presented in the Parliament every year.

Welfare Schemes under AIHB

Some of the welfare schemes introduced by the AIHB include:

The Handloom Weavers Comprehensive Welfare Scheme

  • Launched in 2018, all weavers and workers between the ages of 18 – 50 were covered under the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY).
  • As part of the same scheme, a maximum of two children of the weavers would be given an annual scholarship for their education.

National Handloom Development Programme (NHDP)

  • This scheme focussed on the education of handloom weavers and their children. Ministry of Textiles provides reimbursement of 75% of the fee towards admission to the National Institute of Open Schooling (NIOS) and Indira Gandhi National Open University (IGNOU)courses for SC, ST, BPL, and Women learners belonging to handloom weavers’ families.

Handloom Marketing Assistance

  • One of the components of the NHDP, this aims to provide a marketing platform to the handloom agencies and weavers to sell their products directly to the consumers.
  • Financial assistance is provided to the eligible handloom agencies for organising marketing events in domestic as well as overseas markets.

Weaver MUDRA Scheme:

  • Under the Weavers’ Mudra Scheme, credit at a concessional interest rate of 6% is provided to the handloom weavers.
  • Margin money assistance to a maximum of Rs.10,000 per weaver and credit guarantee for 3 years is also provided.
  • The MUDRA portal has been developed in association with Punjab National Bank to cut down delay in disbursement of funds for margin money.

Yarn Supply Scheme –

  • Under this scheme Yarn warehouses were set up in handloom dense areas, and yarn was provided to weavers at a 10% subsidy.
  • In 2015, the same study conducted among 146 weavers in Madhya Pradesh showed that 98% were happy with the scheme as they got all kinds of yarn at mill gate price.

Where ‘Autonomous bodies’ are required in the process?

  • Ministries and departments frame policies and ensure their implementation.
  • They are supported by a number of organisations such as autonomous bodies, statutory bodies, subordinate and attached offices, and affiliated organisations, etc.
  • Their mode of establishment and funding, and functional autonomy differs.

Reason behind the latest development

  • This is a bold step in achieving leaner government machinery and to introduce systematic rationalisation of government bodies.
  • The intention to review the “other” government organisations has been evident for quite some time.
  • In the 2016 Union Budget speech, then finance minister Arun Jaitley announced that a task force has been constituted for rationalisation of human resources in various ministries. He also contemplated a comprehensive review and rationalisation of autonomous bodies.

Governance Issues in ABs

Despite a laid out administrative structure in ABs, there are a number of governance issues that needs review.

  • On one side of the debate are proponents who believe that since these bodies are funded by taxpayer’s money, they should follow the policies of the government and be accountable the way the government departments are.
  • Others claim that they being “autonomous” have the right to make their own financial and administrative policies.
  • Not clearly defined: Obviously the stronger side wins, as autonomous bodies are not clearly defined.
    • To compound matters, the exact count of ABs is not known, with estimates ranging from 400 to 650 plus.
    • Then, ABs employ a considerable number. For example, the Indian Council of Agricultural Research, an AB under the ministry of agriculture, has almost 17,000 employees.
  • No uniform recruitment: However, unlike the government and the public sector undertakings, in which the recruitment rules are uniform and the recruitment is done by a centralised body such as the Staff Selection Committee (SSC), the Union Public Service Commission (UPSC), and the Public Enterprise Selection Board, there is no such body for CAB recruitments.
  • Accountability issues: Finally, there is an accountability issue. Even though the senior ministry officials are required to attend ABs’ committee meetings, they mostly don’t due to their busy schedules. They nominate junior officials who often lack the jurisdiction to take meaningful decisions during the meetings. As regards audits, some ABs are audited by CAG whereas many are done by chartered accountants.

What needs to be done?

There is an urgent need to review the governance of ABs, and devise uniform procedures. The following measures should be adopted at the earliest:

  • Legal framework: First, a legal framework to describe an AB should be drawn up, which defines the boundaries of its working, its autonomy, and the various policies that it must follow. This will simultaneously help identify the numbers.
  • Comprehensive review: Based on a laid-out framework, each ministry will need to undertake a comprehensive review of ABs under their jurisdiction.
  • Objective oriented: ABs that have outlived the cause for which they were established may need to be closed or merged with a similar organisation or their memorandum altered as per the new charter.
  • Dedicated task force: In order to bring about uniformity in the policies, a task force needs to be set up under a pan-Indian agency such as SSC or UPSC to streamline the recruitment rules, salary structure, allowance and perks paid to employees, and mode of recruitment.
  • Focus on participation: To ensure the participation of ministry officials, committee meetings of similar ABs should be held together so that the appropriate authorities could provide meaningful suggestions.
    • It is also alleged that most of the agenda items raised by ABs are routine in nature. This should be discouraged, and only the important policy issues that need the ministry’s intervention should be taken up in such meetings.
  • Performance audit: A one-time performance audit of ABs should be undertaken by an independent agency. CAG had done an exhaustive performance audit of autonomous scientific bodies in 2016, highlighting the gaps in their performance. Such a theme-based audit should be done for other ABs as well.


 As of now, the board is not there. In future, the government may set up a central body to regulate handlooms and handicrafts in the country.


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