Pune, June 2021

In India textiles and apparels industry availed credit of Rs 1.62 lakh crore

Small Industries Development Bank of India (SIDBI), the principal financial institution engaged in the development of Micro, Small & Medium Enterprises (MSMEs), and CRIF High Mark launched its third edition of Industry Spotlight that analyses the ‘Indian Textile and Apparels’ industry.

Credit landscape in the Indian textile and apparels industry
According to the report, the total amount of credit availed by the sector as of December 2020 stood at Rs 1.62 lakh crore, which witnessed a Y-o-Y decline of nearly 20%. This is due to the suspension of manufacturing activities in the immediate aftermath of the COVID-19 lockdown in March 2020. The report also states that the number of active loans, in the sector stood at 4.26 lakh, as of December 2020. The industry observed a quarterly decline in Non-Performing Assets or NPAs (proportion of credit value delinquent by 90+ days) over the last two years, from 29.59% in September 2018 to 15.98% in September 2020. NPAs in December 2020 increased by 0.94% which is nearly 8% lower than NPAs in December 2019.

Export earnings from the sector dropped as of December 2020
Over the years, apparels have contributed to a majority share of exports, followed by home textiles and fabric. However, as per the third edition of the Industry Spotlight, export credit of December 2020 stands 25% lower Y-o-Y, largely due to a decline in exports due to the pandemic.

MSME borrowers have a lion share of the overall credit by volume
With 95% of the overall credit by volume of the sector concentrated in micro, small and medium segment of borrowers, the industry has a presence of close to 5 lakh borrowers as of December 2020.

Read more