The president of the Tirupur Exporters' Association (TEA) Raja M Shanmugham has appealed to banks to pass on the rate cut benefits to exporters, who have been allegedly struggling and facing hiccups post GST. Exports' associations in the region have welcomed the monetary policy committee's move to bring down repo rate from 6.25 per cent to 6 per cent.

Shanmugham has said the association had made representations to all banks for enhancing the limit to ease the working capital blockage. The entire business community expected it, as inflation is coming down, said Sakthivel and urged the RBI governor to take necessary steps to see all banks cut lending rates immediately as there is scope for the banks to reduce interest rate further beyond RBI rate cut.

A reduction of 50 basis points in key lending rate has been announced this time, as inflation has come down to 1.54 per cent in June. Inflation in May 2017 was 2.18 per cent, in June 2016 it was 5.77 per cent, says Sakthivel.

Economic growth unexpectedly slowed to its lowest in more than two years. Manufacturing sector contracted in July following the GST. Exporters are facing serious working capital crunch and hence adequate availability of cheaper fund, especially for MSME sector, is the need of the hour to make products competitive in the international market, Sakthivel added.