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Exporters Appeal For Instalment In Repayment Of Funded Interest Term Loan as Deadline Approaches

Image courtesy: Tirupurexporterscompany.com

Chennai:

Port Wings News Network:

Tirupur Exporters Association (TEA) has appealed to the Government for instalment in repayment of Funded Interest Term Loan (FITL) and extension of interest equalisation scheme.

Shri. Raja M Shanmugham, President, TEA, said RBI had decided to permit lending institutions to convert the accumulated interest on working capital facilities over the total deferment period of 6 months (i.e. March 1, 2020 up to August 31, 2020) into a Funded Interest Term Loan (FITL) which shall be fully repaid during the course of the current financial year, ending March 31, 2021.

“KNITWEAR BUSINESS IN TIRUPUR HAS NOT FULLY RECOVERED”

Shri. Raja M Shanmugham said: “As the knitwear business in Tirupur has not fully recovered due to less offtake of the exports and emergence of second wave of COVID-19 in the major markets like Germany, France and UK and coupled with the increasing of Cotton Yarn prices and irregular supply of yarn for the past four months has affected the knitwear sector largely, particularly MSMEs, is struggling to sustain in the business.”

“In this scenario, the knitwear exporting units are finding it difficult to repay the Funded Interest Term Loan (FITL) and in view of the gravity of the situation, he has appealed to the Hon’ble Finance Minister to permit for repayment of FITL in Six equal monthly instalments which will help the MSMEs in knitwear sector to get revived back, sustain and strive for the growth of the units,” he added.

Shri. Raja M Shanmugham said after approval of Government of India, RBI had permitted for extension of Interest Equalisation Scheme on Pre and Post Shipment Rupee Export Credit with same scope and coverage up to March 31, 2021 and the extension was from April 01, 2020 and end on March 31, 2021, covering a period of one year. He informed that 5% interest subsidy is given on Pre and Post Shipment Rupee Export Credit for MSMEs and 3% interest subsidy for Non-MSMEs.

He further pointed out that as the competitiveness has to be maintained by the MSMEs, 95% of readymade garment exporting units are in MSME, another requisition was also made to Hon’ble Finance Minister to advice RBI to permit for extension of Interest Equalisation Scheme for another 3 years, which will help the MSME exporting units to work out their costing accordingly and strive to take more export orders and sustain in the business.

Shri. Raja M Shanmugham said as the deadline 31st March 2021 is nearing, he appealed to address the both issues expediently.

The representation has also been sent to Smt. Smriti Zubin Irani, Hon’ble Union Minister of Textiles, Shri. Piyush Goyal, Hon’ble Union Minister of Commerce & Industry, Shri. Nitin Gadkari, Hon’ble Union Minister of Road Transport and Micro, Small and Medium Enterprises and Shri. U. P. Singh IAS., Textiles Secretary, Shri. Anup Wadhawan IAS, Commerce Secretary and Shri. B. B. Swain IAS., MSME Secretary.

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