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Textile industry appeals for cotton fibre security
30
Sep '16
L-R: Smriti Irani, Vanathi Srinivasan and M Senthilkumar
L-R: Smriti Irani, Vanathi Srinivasan and M Senthilkumar
A pan-India textile industry delegation has urged Union textiles minister Smriti Irani to announce cotton fibre security policy by extending a low cost working capital fund. The policy should also ensure adequate stock to use ratio of cotton to have a level playing field in the globalised environment. India's current stock to use ratio is 12-15 per cent.

The 19-member delegation, which met the Union minister, was led by Tamil Nadu BJP general secretary Vanathi Srinivasan and The Southern India Mills' Association (SIMA) chairman M Senthilkumar. It included representatives from Northern India Textile Mills' Association (NITMA), Rajasthan Textile Mills' Association (RTMA), Tamil Nadu Spinning Mills Association (TASMA), South India Spinners' Association (SISPA), Indian Texpreneurs Federation (ITF), Tirupur Exporters' Association (TEA), Powerloom Development & Export Promotion Council (PDEXCIL), Andhra Pradesh Spinning Mills Association, All India Spinning Mills Association, Tamil Nadu Open End Spinning Mills Association, and All Gujarat Spinners' Association.

The predominantly cotton based Indian textile industry has been facing acute crisis during the last eight years due to high volatility in cotton prices especially during off season starting from May to September. Though the cotton year is October to September, more than 80 per cent of the cotton arrives in the market during November to March. Due to financial constraints and three months credit limit facility extended by the banks, spinning mills are forced to procure high cost cotton for at least five months, the delegation apprised the minister.

The joint memorandum submitted on the basis of collective decision taken by 26 textile associations across the value chain in the country, insisted the government to direct Cotton Corporation of India to procure 70 to 80 lakh bales of cotton during peak season when the Indian cotton price rules lower than the international price, retain cotton as buffer stock and sell this quantity only to the actual users during May to September.

Senthilkumar said that cotton fibre security is very essential as more than 80 per cent of the textile manufacturing units are in the MSME category which provides 35 million jobs directly. He stated that the cotton price which was Rs 33,000 per candy of 355 kg reached almost Rs 50,000 per candy during July 2016 thus increasing the clean cotton price up to Rs 65 per kg while the yarn price increased only by Rs 20 to Rs 30 per kg, thus making the spinning mills to incur Rs 20 to Rs 25 per kg loss during the last three months.

This has caused several hundreds of mills to cut down production by 20-35 per cent throwing lakhs of people out of jobs. Downstream sectors such as handlooms, powerlooms and apparel also incurred huge losses and there was a decline in the export of cotton textiles.

SIMA chairman appealed to the Centre to ensure adequate stock-to-use ratio of 25 per cent, which is currently 12 to 15 per cent in India as against world average of 91 per cent including China and 54 per cent excluding China. (RKS)

Fibre2Fashion News Desk – India

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