Knitwear exporters in Tirupur have expressed disappointment over RBI Governor Raghuram Rajan’s maiden mid-quarter monetary policy announcement.
The knitwear sector, according to A. Sakthivel, President, Tirupur Exporters’ Association , was expecting a cut in the repo rate.
“The 25 basis points increase in the repo rate was therefore quite unexpected and coming as it does at a time when exports touched a double-digit growth in August is a matter of concern,’’ he said and pointed out that this growth trend could be maintained only if the borrowing costs were less.
“Though the marginal standing facility (the rate at which scheduled banks can borrow funds overnight from RBI) has been reduced, since the interest rate is still at a high of 9.5 per cent, the borrowing costs would only go up,’’ he said.
The TEA President once again reiterated for a separate chapter for the export sector in the monetary policy to protect the sector.
He appealed for implementation of the Padmanabhan Committee recommendations for evaluating the entire gamut of facilities/services provided by banks to the exporters expediently.