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Textile sector combats power shortage
Nov '08
Textile Mill
Textile Mill
Consumption of cotton by textile mills during the ongoing fiscal is expected to be similar as last year, forecasts Cotton Advisory Board.

Last year country's textile industry consumed 241 lakh bales and in the coming year as per the recent estimate of Cotton Advisory Board, the consumption could be same as the last year, provided the power situation in Tamil Nadu improves.

Available statistics show that the area under cotton cultivation during 2008-09 is around 92.6 lakh hectares compared to 95.55 lakh hectares last year.

In an exclusive conversation, on less consumption of cotton, in the current fiscal, Dr K V Srinivasan, Chairman, Southern India Mills' Association (SIMA), told Fibre2fashion, “There is a global recession for textile business and therefore major manufacturing countries like China, Pakistan, India and Bangladesh are in the process of down sizing their manufacturing activities to the tune of 20 to 30 percent.

Indian textile industry is saddled with factors like steep hike in minimum support price for cotton resulting in high cotton price, hardening of bank interest rate, withdrawal / steep reduction in export incentives, high fuel cost, high transport cost etc, and Tamil Nadu which accounts for almost 47 percent of the spinning capacity consuming around 110 lakh bales of cotton annually is suffering power shortage to the tune of 40 to 50 percent.

“Since there is no symptom of improvement in the power supply position except during the wind season, there will be 20 to 30 percent drop in production during the coming year in Tamil Nadu. Therefore, this reduction could be curtailed only when the Government of Tamil Nadu implements the captive generation model by utilizing the idle capacity of furnace oil and high speed diesel oil generators available with the industrial units on a need basis by reimbursing the additional cost of generation. Therefore, it might result in sizable reduction in the consumption of cotton during the next season by the Indian spinners.”

Recently, price of cotton has gone down. Discussing its impact on the industry, Dr Srinivasan, stated, “Though there is a reduction in the cotton prices due to significant fall in the international cotton price scenario, the abnormal hike in minimum support price for cotton as announced by the Government has seriously affected the market and the textile mills which are already incurring huge cash losses are not in a position to procure the cotton due to severe financial crunch. This is high time the textile industry needs enough support from the State and the Central Governments to create a win-win situation both for the farmers and the textile industry.”

Annual consumption of the textile mills in Tamil Nadu reaches nearly 110 lakh bales of cotton, however, this year, due to severe power shortage, the utilization capacity has gone down drastically.

While sharing his outlook on this, SIMA Chairman lamented, “Currently, Tamil Nadu Electricity Board has announced 40 percent demand cut and energy cut for all the HT consumers. In addition, it has also restricted the power supply for four hours during the peak hours (between 6 pm and 10 pm). Besides, the industrial units are also facing two to three hours unscheduled load shedding resulting in 50 percent production loss. The situation might get worsened during March-April 2009 and might improve only in May when the wind season begins.”

Fibre2fashion News Desk - India

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