As per RBI data, credit exposure to textiles sector, which had increased to Rs. 2,03,549 crore in March 2019 from Rs. 1,96,818 crore in October 2018, has declined to Rs. 1,87,677 crore in October 2019.
As per Ministry of Textiles, bank credit records 9.5 per cent year-on-year growth (October 2019/October 2018) for Man-Made Textiles (MMT) and 2.1 per cent for other textiles.
Credit availability is expected to grow further with capital infusion of Rs. 1,500 crore during 2019-20 and other measures announced by the Government like infusion of Rs. 70,000 crore capital into public sector banks, Rs. 350 crore allocated for 2 per cent interest subvention for all GSR-registered MSMEs on fresh or incremental loans, enhancing threshold expansion from Rs. 20 lakh to an amount exceeding Rs. 40 lakh for supplier of goods.
It is pertinent to mention here that slowdown in overall global growth has impacted the growth of most of the domestic sectors including textiles and subsequent improved demand and profitability will be partly countered by sticky working capital requirement.
It is to be noted here that the Government has taken a series of measures, in addition to the above-mentioned interventions, for improving profitability such as repo rate reduction by RBI; provision of capital infusion of Rs. 1,500 crore during 2019-20; implementation of Pradhan Mantri Credit Scheme for powerloom weavers; reduction in customs duty for wool fibre, wool tops; extension of benefit of reduced corporate tax rate; new SFURTI clusters to help artisans; introduction of automated GST module; one nation one grid power sector tariff and structural reforms; simplification of tax paying procedures; announcement of RoSCTL for apparel and made-ups exports.