01 March 2022, Mumbai:
A fresh influx of money is desperately needed to revitalize MSMEs and return them to regular operation.
Apparel exporters in Tirupur have asked the Finance Minister to establish a new plan similar to ECLGS that would allow MSMEs to take out extra credit of 10% to 20% of their present ceiling, which is urgently needed to get them out of the crisis.
Tirupur Exporters' Association (TEA) President Raja M. Shanmugham and Vice President E. Palanisamy met with Nirmala Sitharaman, Union Minister of Finance and Minister of Corporate Affairs, in Chennai and handed over a representation requesting that issues to support MSMEs in this time of crisis be addressed, as well as the condition imposed in the Union Budget 2022-2023 while importing accessories be removed.
They also pointed out that exporting firms that were buying 1kg cotton yarn for Rs. 300 15 months ago could now only buy 1⁄2 kg cotton yarn for the same price, putting MSMEs in serious financial difficulty.
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It's worth noting that Tirupur Knitwear exports in the current financial year 2021-22 totaled Rs. 26,030 crore in the first ten months (April-January) and are on track to surpass Rs. 32,000 crore. The business is concerned that Russia's recent invasion of Ukraine and the worldwide fallout might disrupt supplies to the EU and UK markets.
Raja M. Shanmugham, TEA also mentioned that in the Union Budget, a Condition No. 9 has been imposed in the amended Notification No. 02/2022-Customs, and as a result of this condition, knitwear exporting units are required to visit the Customs Preventive Unit in Coimbatore for the import of items on each occasion, posing additional practical difficulties as well as wasting a significant amount of time due to various reasons.
Aside from the needless delay, there are other costs associated with getting things done. The TEA has pointed out that this issue has arisen at a time when the government is promoting commercial ease.
The TEA has also requested that the Interest Equalisation Scheme (IES) be extended for another two years with retroactive effect. The IES on Pre- and Post-Shipment Rupee Export Credit, which was set to expire on September 30, 2021, was not renewed.
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BGMEA Vice President Miran Ali and Directors Asif Ashraf, Tanvir Ahmed and Abdullah Hil Rakib were also present on the occasion.
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*Credits: Textile Today
