Rakesh Mehra, Chairman, Confederation of Indian Textile industry (CITI), has urged the government to introduce financial support measures to elevate the stress on working capital in India’s spinning segment. Mehra also urged for prevention of job losses in the sector, sustaining market share, and achieving envisaged export targets.
India’s spinning segment has been hit by the prolonged Ukraine-Russia conflict, the recent Israel-Hamas war, an 11 per cent import duty on cotton and issues related to Quality Control Orders on man-made fibers.
Capacity utilisation in the segment has dropped by almost 70 per cent, adds Mehra.
The government should extend the one-year moratorium for repayment of the principal amount, and convert three-year loans under Emergency Credit Line Guarantee Scheme (ECLGS) into six-year term loans, he adds further.
Until now, the textile industry has received funds worth Rs 16,920 crore under the ECLGS. These constitute approximately 6 per cent of the total disbursement of Rs 2.82 lakh crore.
However, the 50 per cent decline in cotton yarn exports, has caused a severe crisis in the spinning segment with cotton textile exports dropping by 23 per cent and total textile and clothing products exports dropping by 18 per cent during FY2022-23, notes Mehra.
