The Southern India Mills’ Association (SIMA) has hailed the extension of moratorium period of term loan for another three months i.e. up to August 31, 2020 by the Reserve Bank of India (RBI).
SIMA says, deferment of interest on working capital, reduction of margin money for working capital and the relaxation of prudential financial norms are welcome features of RBI’s announcement. The extension of permissible period of pre & post-shipment export credits by three months and the time for remittances against normal imports from six months to 12 months would also greatly help the exporters and importers to ease their liquidity.
As international and domestic demand for textiles and clothing is likely to drop by 30 to 40 per cent with the existing lockdown conditions during the current financial year, SIMA also requested the government to allow one time debt restructuring for the textiles and clothing industry, as it would greatly help the mother industry that employs over 105 million people to prevent job losses, sustain the survival, and revive from the unprecedented crisis.
SIMA also urged the Prime Minister to direct all banks to extend the various benefits announced by RBI immediately so that the industry could tide over the COVID-19 crisis.