Struggling to survive, apparel exporters decided to approach the Government strongly especially with regard to MEIS (Merchandise Exports from India Scheme) and RoSCL (Rebate of State and Central taxes and Levies).
With 4 per cent incentive, MEIS, lifeline of garment exporters, is no longer expected to continue, while industry still does not have any clarity on the implementation of RoSCL.
This and other issues were highlighted at a meeting chaired by Nitin Gadkari, Union Minister of MSME and Nirmala Sitharaman, Union Minister of Finance at North Block, Delhi.
This apart, a representative of Apparel Export Promotion Council (AEPC) met various MPs (Members of Parliament) and urged them to raise the issue with the honourable Prime Minister.
The apparel exporters requested the Government to continue MEIS. They also insisted that if MEIS is discontinued then the Government should announce an alternate scheme to enhance the competitiveness of beleaguered garment exporters.
Raja M. Shanmugham, President, Tirupur Exporters Association who was present in the meeting told, “Apart from highlighting issues of MEIS and RoSCL, we have appealed to insulate MSMEs from following BASEL III norms and categorically mentioned that the requirement of credit rating insisted under BASEL III norms before getting loans from banks is not at all necessary, as the rating does not reflect the true nature of whole garment sector and the real performance of the respective unit.”
The Basel III norms limit the amount of debt a bank can owe even further.
Raja is of the view that BASEL norms are being implemented in India without adequate checks and balances. The BASEL norms have been helpful only for large corporates including manipulators like Nirav Modi and others rather than the performers in MSMEs. As a result of BASEL norms, the MSMEs are undergoing severe financial stress due to liquidity crunch and the revised NPA (Non Performing Asset) classification.
He also requested for restructuring of the unit twice rather than once considering the seasonal business nature of garment units. While deliberating on the NPA classification, he requested to take into account 180 days period against the existing 90 days.
A. Sakthivel, Vice-Chairman, AEPC told that the Council had written to all the MPs from Tamil Nadu and explained to them the benefits of MEIS for garment exports, why it should be continued, and the impact on the exports if the scheme iswithdrawn. The MPs assured them that they would take up with the Government the need to continue MEIS.