Highlighting the severe crisis faced by the garment
export sector due to multiple factors, Tamil Nadu Chief Minister M.K.Stalin
has urged Prime Minister Narendra Modi to announce a Special Emergency
Credit Line Guarantee Scheme (ECLGS) for the MSMEs in the garment
sector immediately and provide 20% additional collateral-free credit under
the new scheme.
In a Demi-Official letter to the Prime Minister, copies of which were
released to the media here today, he said the garment export sector
is undergoing a severe crisis as a result of multiple factors including
the economic impact of Covid-19, the Russia-Ukraine war and the
anticipated economic slowdown in the West.
“I understand that the month-on-month growth rate in readymade
garment exports is now showing a sharp decline”, he said.
Pointing out that Tiruppur wass one of India’s largest knitwear exporting
clusters that cater to US, UK and European markets, the Chief Minister
said MSMEs constitute 95% of the exporting units in this cluster.
It is reported that the orders for the summer season have now declined
by around 40% when compared to last year. The exporting units and their
supplier MSMEs are staring at a severe financial crisis in the ensuing
months due to low demand, he said.
“Lakhs of jobs, particularly for rural women who form a significant
chunk of the workforce are in danger”, Stalin said, adding, considering
the above circumstances, the MSMEs must be given special credit
facilities to survive this crisis.
“I request you to announce a special Emergency Credit Line Guarantee
Scheme (ECLGS) for the MSMEs in the garment sector immediately.
Twenty per cent (20%) additional collateral-free credit may be provided
under the new scheme”, Stalin said and urged the Prime Minister to
favourably consider this reuqest.