Tamil Nadu - Coimbatore

‘Stimulus package disappointing’

COIMBATORE: The textile sector is disappointed with the second stimulus package announced by the Government on Friday as it is “inadequate”, according to the Southern India Mills’ Association.

Association chairman K.V. Srinivasan has said in a release that the industry had been demanding a comprehensive relief package to revive the textile sector. But the stimulus packages announced so far would not help the sector completely.

The marginal relief in the value cap of duty drawback rates for cotton yarn and grey knitted fabrics and extension of Duty Entitlement Passbook Scheme up to December 2009 were the only features for the benefit of the textile sector.

Even in the upward revision of the duty drawback rates, made-ups and dyed knitted fabrics had been ignored.

The industry was hoping for major relief measures such as two year moratorium for repayment of loans, a special package for working capital, seven per cent interest for cotton purchase, reduction in margin money for working capital and enhancement of credit limit from three months to nine months.

A clear cut guideline was needed from the Reserve Bank of India for the units to get two year moratorium.

With the minimum support price for cotton increased substantially, the industry was unable to procure cotton at internationally competitive rates.

Hence, Mr. Srinivasan urged the Government to have a re-look at the proposals submitted by the industry and announced a fresh package for the sector.

© Copyright 2000 - 2009 The Hindu