In the wake of overseas buyers cancelling or deferring orders, textile associations have appealed to the Central Government to extend financial support.
Cotton Textiles Export Promotion Council chairman K.V. Srinivasan pointed out, in a press release, that with spread of COVID-19 in Europe, U.K. and the U.S., several buyers had put purchases on hold. If the situation did not improve in two to three weeks, exporters would have to cut production and go in for lay offs.
Hence, the government should:
- extend the scheme for reimbursement of taxes and levies for cotton yarn and fabric exports
- provide 3 % interest sub vention beyond March 31, including products such as quilts and cotton shopping bags for ROSCTL (Reimbursement of State and Central Taxes and Levies)
- expedite GST refunds
According to T. Rajkumar, chairman of Confederation of Indian Textile Industry, banks should provide moratorium for repayment of principal and interest amounts and exempt at raw materials from anti-dumping duty and Customs Duty.
Apparel Export Promotion Council Chairman A. Sakthivel said, in a press statement, that:
- banking and packing credit clearances should be faster
- the packing credit period for existing orders should be extended upto a period of 360 days from the existing 270 days
- existing limits for exporters should be enhanced 25%
Ashwin Chandran, chairman of Southern India Mills’ Association, said, in a press release, that the textile and clothing industry needed handholding from the government to overcome the current crisis. The banks should provide one year moratorium for repayment of principal amount and interest.
According to the Tiruppur Exporters’ Association president Raja Shanmugham, the foreign buyers are deferring payments for goods already shipped and some are not lifting the goods. In order to face the disruption in economic activity, there should be a reduction of interest rates. The government should announce a stimulus package and re-energise the market.
The Indian Texpreneurs Federation convenor Prabhu Damodharan said that working capital loans should be converted to long term loans for the needy units, the working capital gap should be identified and working capital term loan should be provided.
