Tamil Nadu Government’s decision to extend the Covid-19 lockdown to August 31 and the indecisiveness on the part of buyers from European Union and United States have made life difficult for the knitwear industry in Tirupur. 

The district is known by the name knitwear capital of the country as the industries here employ 6,00,000 workers and earn Rs 200 billion per year by way of exports. 

But the Covid-19 pandemic has struck a heavy blow on the backbone of the industry, according to Raja M Shanmugham, president, Tirupur Exporter’s Association (TEA), the umbrella organisation of all the knitwear units in the district. 

The Covid-19 and the resultant repercussions have resulted in a 60.54 per cent fall in earnings from export in the first quarter of current financial year 2020-2021. “Last year we had earned Rs 13,570 crore while the figure for the same period this year is Rs 5,355 crore. This is a negative growth,” said Shanmugham. 

Listing out the woes haunting the industry, Shanmugham said that all units in Tirupur were running partially with an average capacity utilization of 40 per cent to 50 per cent. “There has been no significant improvement in garment purchase in European Union and US markets till now. Buyers place order in slow pace manner,” said the TEA chief. 

He said unless the Government of India, especially the finance ministry extends the moratorium on term loan instalments and working capital facilities by another seven months (from September 1, 2020 to 31, March 2021) the industry would face major crisis and many units would be forced to shut down. 

“The re-classification of Micro, Small and Medium Enterprises (MSME) has brought many new units under the category of MSME and Further to upward revision of Medium enterprises definition, where the investment in plant and machinery or equipment does not exceed Rs 50 crore and turn over does not exceed Rs 250 crore, more number of knitwear exporting units in Tirupur have been fit into definition of MSME. All these units should be allowed to make use of the Emergency Credit Line Guarantee Scheme (ECLGS),” said the TEA president. 

The TEA have been alerting the Centre about the indifference and callousness of the bureaucrats as well as Bankers towards their minimum needs which are a must to sustain the industry. Shanmugham has been requesting the Government of India to adopt a wartime strategy to save the industry rather than a Rule Bound approach.

The Association has sent a memorandum to the Prime Minister pleading to save the knitwear industry and lakhs of workers employed by it.

Published On : 02-08-2020

Source : The Pioneer

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