Tirupur Exporters Association thanked the Hon’ble Prime Minister for taking for various measures to contain the spread of COVID – 19 pandemic and protecting the industry.
In respect of working capital facilities sanctioned in the form of cash credit/overdraft, lending institutions are being permitted to allow a deferment of three months on payment of interest in respect of all such facilities outstanding as on March 1, 2020.
The accumulated interest for the period will be paid after the expiry of the deferment period. “Our concern is that the moratorium of three months period will get expired by 31st May 2020 and the commencement of repayment starts by 1st June 2020, including the compounded interest calculated for the moratorium period,” said Raja M. Shamugham, President, TEA.
“We would like to drive home the point that for the past two months, the industries have not been permitted to operate and moreover, if we take into account the global market closure date also, it would be actually three months. More importantly, the leading global retail stores would reopen only from June onwards and place the orders gradually, that too in an increment manner only,” said he.
Without having any activities and the house totally in disorder, the MSMEs could not repay the interest and with this background, we strongly feel that the revival of MSMEs would happen only after another six months, after addressing the issues one by one. “In view of this, we request to extend the moratorium on servicing of interest and principal by another nine months to MSMEs,” pointed by Shamugham.
Considering the gravity of the issue, we request the Hon’ble Prime Minister to kindly advice to announce the extension of moratorium for both MSMEs and Non-MSMEs (not in corporate league), which will be immensely helpful to get envisaged revival in post COVID-19 and to restore normalcy.