IANS | 20 Jul, 2023
Scrapping of import levy on cotton, ban waste cotton exports and
restructuring of the Emergency Credit Line Guarantee Scheme (ECLGS) are
the three measures needed to help the MSME-led spinning sector in the
state, Tamil Nadu Chief Minister M.K.Stalin told Prime Minister Narendra
Modi.
Stalin
in a letter to Modi said high cotton prices, operational costs and poor
demand in domestic/international markets has plunged the spinning
sector into a crisis and the industry association has announced
production stoppage from July 15 onwards.
The
Chief Minister said the repayment of ECLGS has begun which is an
additional burden on the spinning mills and increasing their production
cost.
"Another
significant price differentiator between India and its competitors
internationally is the 11 per cent import duty imposed on cotton in
India," Stalin added.
Stalin
requested Modi that the central government provide financial support
for MSMEs in the textile sector under ECLGS by extending the moratorium
by one more year.
Existing
loans under ECLGS may be restructured, converting them into six-year
term loans, and fresh loans may be provided under ECLGS, reducing the
regular banking interest rate, Stalin said.
Stalin
also said the central government should ban export of waste cotton
temporarily to tide over the shortage faced by the Open-End spinners who
fall under the micro-enterprises category but contribute to 35 per cent
of the yarn production of the country primarily used in low-end
fabrics.
He also urged the central government to withdraw the 11 per cent import duty on cotton.
According
to Stalin, with 1,500 spinning mills and around 15,00,000 employees,
the spinning sector is one of the vital engines of the industrial
economy of Tamil Nadu.
