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The Southern India Mills’ Association

Committed to Foster the Growth of the Textile Industry

Exporters seek revisit of NPA policy by banks

With huge amounts of incentives and dues pending from the government to them, the garment exporters here wanted the banks to take cognisance of the receivables from the government side while classifying their loan accounts as non-performing assets (NPA).
The exporters here are seeking for a revisit to the NPA policy by banks through government channels since such changes needed intervention of various monetary policymakers. Currently, the pendency of dues under Remission of State Levies scheme alone stand at Rs. 450 crore collectively for the Tirupur knitwear cluster, according to the statistics compiled by the Tirupur Exporters Association.
Besides, there was an outstanding capital goods subsidy of Rs. 100-odd crore for the entrepreneurs here under the Amended Technology Upgradation Fund Scheme.
“The banks should take up loan dues and the subsequent classification as NPA on a case-to-case basis instead of following the blanket norms on NPA classification. “The banks should take into consideration how much dues are pending for a particular industrialist and proportionally compute the loan portion which should be turned NPA, said TEA president Raja M. Shanmugam.