The Federation of Indian Export Organisations, Southern Region (FIEO-SR), has said the situation arising from the COVID-19 pandemic for exporters is grave and many factories across sectors will be forced to slow down or stop production.
Seeking urgent intervention of State and Central governments, FIEO-SR chairman Israr Ahmed there is possibility of large-scale cancellation of orders, supply chain disturbance, delayed or even non-payment by buyers, which will seriously affect exporters’ cash flow.
This put the export sector, especially micro, small and medium enterprises, in a very serious spot, he said. On their part, industries are trying to provide help to employees and co-operate with the government for containing this serious issue.
Mr. Ahmed said this while urging the government to initiate a number of measures for the benefit of exporters, including relaxation of non-performing asset (NPA) norms to accommodate delay in getting payment. “Lack of business coupled with fixed cost will force units to close if NPA norms are not relaxed,” he said.
Figuring in the list of measures sought by FIEO-SR are instructions to banks to facilitate faster clearance of credit applications and extend up to 25% automatically the existing credit; extension of the export realisation period from 270 to 360 days; all input tax credit/integrated goods and service tax refunds may be provided to exporters instantly; and deferring employees' state insurance payments for three months as well as advance tax payment till at least September 30.
The umbrella organisation of exporters also urged the government to consider extending the Pradhan Mantri Rojgar Protsahan Yojana incentive of 8.33% for all old and new employees for six months till the exporters tide over the crisis.
