SIMA hails PM’s Rs 20 lakh cr relief package

Ashwin Chandran, Chairman, The Southern India Mills’ Association (SIMA) has thanked the Prime Minister for announcing the special economic and comprehensive package of Rs 20 lakh crore equivalent to 10 per cent of India’s GDP to make the country to march towards self-reliant India. He has thanked the Government for revising the definition of MSME, a long pending demand for the industry by incorporating annual turnover and increasing the investment limits under the eligible criteria and increasing the turn over limit up to Rs 100 crore and investment limit up to Rs 20 crore for medium size units. 

Chandran has stated that since the textiles and clothing industry predominantly MSME in nature, this will greatly benefit over 60 per cent of the textile units across the textile value chain especially the garment and made-ups units. He has thanked the Government for allocating Rs 3 lakh crore to extend collateral free loans for businesses including MSMEs and also providing four year tenor with moratorium of 12 months on principal repayment, allocating Rs 20,000 crore for stressed MSMEs and Rs 50,000 crore for potentially viable MSME units.

SIMA Chairman has also welcomed the marginal reduction of 2 per cent in the employer’s and employees’ contribution in the EPF and 25 per cent reduction in the TDS and TCS that would help to improve the liquidity to certain extent.

SIMA Chairman has hoped that the Government would consider industry’s dire demand of extending the moratorium for repayment of loans and interest already extended for three months from March 1, 2020 for another 10 months, i.e., up to March 31, 2021. He has also hoped that the Government would also consider and extend 25 per cent additional working capital without any collateral or margin money for all the categories of accounts other than MSMEs also in the next financial relief package to be announced shortly. Chandran also has hoped that the Government would soon announce a special package for boosting exports for all the textiles and clothing products including cotton yarn and fabric to grab the emerging opportunities and also consuming the surplus cotton that might significantly affect the cotton farmers in the country.

Chandran has appealed the Government to modify the MSME definition criteria as either investment or annual turnover to encourage technology upgradation in the MSMEs sector and also help the help the capital intensive sectors like spinning, independent weaving, processing, etc.