Retailers Association of India (RAI) has urged Finance Minister Nirmala Sitharaman to extend the emergency credit line guarantee scheme for retailers and grant a six-month loan moratorium.
As brick-and-mortar stores remain closed in many localities under lockdown and many online retailers face restricted operations, the RAI has asked the government to step in and aid the sector to mitigate the financial damage. As per Fashion Network, on April 28, the RAI asked Sitharaman for a moratorium on principal and interest of all loans for up to six months and a reduction of interest rates on all loans. The traders’ body also asked for an extension of the benefits of the emergency credit line guarantee scheme 3.0 to retail companies.
The RAI stated that around 80 per cent of retail outlets are closed due to various local lockdown restrictions which could lead to Rs 75,000 crore ($11.3 billion) becoming non-profitable assets should the Reserve Bank of India do nothing.
This will put at risk almost three million jobs directly in the retail sector, said the RAI. Associated sectors that depend upon retail would also be similarly impacted. In the textile sector alone, across the entire value chain almost 10 million jobs are at risk. Further, it will extinguish the engine that can kick-start a consumption led recovery for our economy.