Tirupur Exporters Association Urges RBI for Dedicated MSME Funding Support
The Tirupur Exporters Association (TEA) has made a strong appeal to the Reserve Bank of India (RBI) to allocate dedicated funding support specifically for Micro, Small, and Medium Enterprise (MSME) exporters. The association has also called for the issuance of clear and actionable guidelines to both private and public sector banks to ensure that this financial assistance reaches industries effectively and without delay.
Interactive Session Highlights Apparel Sector Challenges and Opportunities
In collaboration with the RBI, TEA recently organized an interactive session focused on the private investment climate within the apparel sector. This event served as a platform to highlight the key challenges and growth opportunities facing MSMEs in the region. Speaking at the session, TEA Joint Secretary Kumar Duraisamy provided a detailed overview of Tirupur's remarkable evolution into a globally recognized knitwear hub.
Duraisamy outlined the cluster's ambitious progression towards achieving an export target of Rs 1 lakh crore by the year 2030. This goal is strategically aligned with the Prime Minister's broader vision of building a $10 trillion economy for India. However, he did not shy away from flagging the major concerns currently impeding MSMEs in Tirupur.
Key Challenges Faced by Tirupur's MSME Exporters
The joint secretary highlighted several critical issues, including persistent labor shortages, stringent regulatory frameworks, and the complexities introduced by Basel III norms, which collectively make access to loans increasingly difficult for small and medium enterprises. Additionally, low credit scores among many MSMEs further exacerbate their financial constraints.
Duraisamy also pointed to environmental sustainability efforts, noting that an impressive 13 crore litres of water is recycled daily through zero liquid discharge systems. However, he emphasized that the high maintenance costs associated with common effluent treatment plants are negatively affecting the global competitiveness of local industries. He urged banks to extend more liberal financial support to help offset these operational expenses.
Tirupur's Dominance in India's Knitwear Export Landscape
According to TEA Treasurer R Gopalakrishnan, Tirupur holds a commanding position in India's knitted garment export market, accounting for a substantial 68% of the nation's total exports in this category. The sector generates an impressive Rs 45,000 crore in annual export revenue and provides employment to nearly 10 lakh people. Notably, women constitute 60% of this workforce, underscoring the sector's role in promoting gender inclusivity in employment.
Industry Recommendations for Enhanced Financial Access
Industry representatives at the session stressed the urgent need for dedicated funding support for MSME exporters, modeled on the lines of educational and agricultural loans. They called on the RBI to issue unambiguous guidelines to banks to ensure a consistent and robust credit flow to the sector. Furthermore, they recommended the development of an online loan renewal platform, similar to the Jan Samarth portal, to simplify and streamline the borrowing process for exporters.
RBI Director's Observations on Investment Trends
RBI Director Dr. Harendra Behera, who also participated in the session, observed that private investment growth has slowed significantly since 2008. He attributed this trend to rising financial costs, regulatory uncertainties, and various global geopolitical factors. Dr. Behera urged MSMEs to proactively leverage existing government and RBI schemes designed to support their growth and sustainability in these challenging times.
