Even after an year of demonetisation, industrialists here say that they are still facing a slowdown.
The woes have been compounded by the Goods and Service Tax, which, according to them, been implemented without proper homework, or adherence to Basel-III norms regarding bad loans.
“Though the intention of demonetisation was claimed to be removal of corruption, there has been no respite from it. The micro, small and medium scale enterprises here faced a lot of difficulties, as a majority of the transactions were cash based,” said Raja Shanmugam, president of the Tirupur Exporters Association.
The sudden withdrawal of currencies resulted in cash crunch, he added.
“About 40 % of micro and small scale enterprises involved in job works and apparel manufacturing, suffered huge losses. Some of them wound up, and others are yet to regain a steady cash flow when GST was implemented in a haphazard manner,” said G.R. Senthilvel, secretary of Tirupur Exporters and Manufacturers Association.
Mr. Raja Shanmugam said that United Arab Emirates implemented GST only after a comprehensive ‘trial run’ to understand the problems.
“India should not have followed Basel-III norms that does not suit our conditions. Because of this, many loans of industrialists were declared non-performing assets for non-payment of dues even during the three months when fund crisis was severe,” said S. Dhananjayan, a chartered accountant.
