Tirupur Exporters’ Association (TEA) today said that RBI maintaining the repo rate at 6.25 per cent was a disappointment to the exporting community, which was expecting the reduction of interest rate post demonetisation.

The reduction in interest rate is most important at this juncture to increase the competitiveness of the 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 said in a statement.

“The sixth bi-monthly Monetary Policy for the year 2016-17 announced today has maintained the repo rate at 6.25 per cent, which is disappointing to the exporting community,” he said.

He pointed that in the Economic Survey 2016-17, for the first time a chapter was allocated to apparel, leather and footwear considering their contribution to the economy, exports and employment, and added that the growth of this employment intensive sector could be possible only when they get borrowings at lower rate.

He said that it was the right time for the knitwear sector to capture the market leaving from China due to increase in cost of manufacturing and specifically noted “…once we miss the bus, those markets will be dented by our competing countries like Bangladesh, Vietnam, Indonesia and Cambodia.”

Raja M Shanmugham expressed the hope that the Monetary Policy Committee would consider the requisition made by the industry in the first bi-monthly policy next year, which would be impetus for the industry.