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Central Govt to take appropriate steps to protect textile industry, SIMA
07
Jul '08
The Indian textile industry, which is going through a bad patch during the last couple of years, is now faced with the problem of very high cotton prices and uncertain supplies.

The factors leading to recession in the textile industry were mainly due to soaring cotton prices, increase in the bank interest rates, high fuel transportation cost, shortage of power and labour.

The textile industry has always been banking on its own good quality cotton for its competitive edge in the global markets.

However, inspite of record bumper crop of 315 lakh bales during the current season as against the requirement of 240 lakh bales during the last year, the cotton prices have almost shot up by 45% and 50%.

All the cotton left the hands of farmers and gone into the hands of multinationals, who in turn have exported cotton to our competitors like China, Pakistan and now dictating terms to the domestic market.

The industry points out that it is not because of the demand and supply, but because of the speculation.

In a press release issued, Dr. K.V.Srinivasan, Chairman, The Southern India Mills' Association has informed that the Association directly and also through its apex body, Confederation of Indian Textile Industry (CITI), made several attempts from the beginning of the cotton season, recommending various remedial measures to be taken by the Government to keep the cotton price under control.

Almost all the Regional Associations of all the sectors also made similar appeals to the Central Government to take appropriate steps to protect the domestic textile industry which provides second largest employment next only to agriculture in the country, particularly for people below the poverty line and rural women folk.

Unfortunately, though the Government including the Hon'ble Prime Minister and other Ministers had been promising to take appropriate steps in various forums, had failed to control the cotton prices.

Therefore, first time in the history of textile industry, all the mills have announced a one-day stoppage of the textile industry protesting against the abnormal hike in cotton prices and entry of multinationals speculating the Indian cotton trade.

SIMA Chief has stated that the steep rise in raw material price has paralysed the working of the entire textile industry with even the top mills incurring heavy cash losses.

He has stated that the untoward development is solely attributed to the speculative activities indulged in by several multinational traders who have entered in the Indian market in a big way this year and acquired the entire supply of good quality cotton not only for export but for selling in the domestic market.

He has criticised the Government for totally neglecting this serious issue. He has further stated that all the farmers have sold their cotton well before January 2008, the multinationals and other traders have purchased the cotton well below Rs. 20,000/- per candy and now selling at Rs.30,000/- per candy.

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