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RBI’s unchanged repo rate disappoints apparel exporters

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The Tirupur Exporters’ Association (TEA) has said the Reserve Bank of India’s decision to keep the repo rate unchanged at 6.25 per cent has disappointed the apparel export community, which was expecting a reduction in interest rate post demonetization.

The reduction in interest rate is the most important at this juncture to increase the competitiveness of apparel sector at a time when the export growth rate is a meagre 3.54 per cent for the nine months period of this fiscal year 2016-17, TEA President, Raja M Shanmugham pointed out in his statement.

According to Shanmugham, China’s cost of manufacturing is skyrocketed at this point of time, thus India has the opportunity to capture the shifting knitwear market from China, else competitors like Bangladesh, Vietnam, Indonesia and Cambodia will make the dent.

Also ReadRBI’s Financial Stability Report: Concern over Indian textile industry

He is optimistic that the Monetary Policy Committee of RBI would consider the industry’s request in the first bi-monthly policy next year and that it would thrust the textile and the apparel sector.

 

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