Though the knitwear exports from Tirupur is poised to cross Rs .32,000 crore this financial year, the exporters have expressed apprehension of an adverse impact in the wake of invasion of Ukraine by Russia.

The exports clocked Rs. 26,030 crore in the last 10 months, said Tirupur Exporters' Association (TEA).

In a memorandum to Union Finance Minister Nirmala Sitharaman in Chennai on Monday a copy of which was released to the media, TEA said the unprecedented rise in price of raw material, cotton yarn in the last 15 months coupled with hike in accessories prices have hit MSMEs on the liquidity front.

Stating that the steep hike of the inputs totally drained their liquidity even after getting credit support through export credit line guarantee scheme, president of TEA Raja M Shanmugham said the units which were purchasing one kg of cotton yarn at Rs 300 months ago could now purchase only half kg for the same amount. As a result, he said the MSMEs were now undergoing liquidity crisis.

The cause of concern is that as per the commitment made to the foreign buyers well in advance, the MSMEs must execute the orders despite incurring losses or getting a wafer-thin margin, he said..

The concern is that 95 per cent of the units in garment exports sector come under MSMEs and to revive and get them back to normal, fresh infusion of liquidity is required, he said.

Considering the impact, TEA requested the Minister to announce the extension of interest equalisation scheme for another two years in order to help the MSMEs work out their costs, take efforts to get export orders and witness growth.

Published On : 01-03-2022

Source : Devdiscourse