SIMA plea for loan repayment moratorium

Coimbatore, Nov 1(UNI)The Southern India Mills' Association (SIMA), representing the organized textile industry in South India, today appealed to the Tamil Nadu Chief Minister and Prime Minister to provide a two-year moratorium on repayment of loans availed from banks by the textile units.

In a press release here, SIMA President K V Srinivasan said a majority of the textile mills had incurred heavy cash loss and were not in a position to repay the loans to the banks during the current year.

The situation was likely to continue for few more years due to acute power shortage faced by the State in addition to steep hike in raw material cost, bank interest rate and transportation cost among others.

He said the Association had also made a representation to restore export incentives like duty drawback rates for yarn, fabrics, made-ups and garments which had been drastically reduced and four per cent interest subvention extended on export credit which had been withdrawn with effect from October first to make the industry globally competitive and considering the huge incentives offered by the competing countries like Pakistan and China.

Pakistan has also extended two year moratorium period for repayment of loans and interest for the textile industry due to ongoing global recession.

The Indian Government has also provided two year moratorium for repayment of loans and interest and interest subvention facilities for sugar industry to tide over the crisis, he recalled.

Dr Srinivasan said the proposed relief would greatly benefit the textile industry in Tamil Nadu which accounted for 47 per cent of the country's spindleage and over Rs 30,000 crore of exports annually.

UNI KS GM 1105