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Knitwear garment sector is in dire straits – TEA

31
May '10
Shri.A.Sakthivel, President of Tirupur Exporters' Association (TEA) said he has made a representation to Thiru. Dayanidhi Maran, Hon'ble Union Minister of Textiles requesting to regulate cotton yarn exports to soften increasing yarn prices.

We are thankful to the Hon'ble Minister for taking various measures, like removal of DEPB, Duty Drawback Rate benefits available for cotton yarn exports and suspension of cotton exports for reduction of cotton prices. The textile industry has got real boost in the past one year due to the Hon'ble Minister's full attention for the development in domestic as well as in the international market.

Due to your efforts, the textile mills had actually brought down the yarn prices by Rs.5/- per Kg. on 1st May and thereafter, the mills have resorted to the new practice of increasing the yarn prices intermittently, three times in this month itself, against the normal practice of revising the prices in the beginning of the month and altogether, the total increase is Rs.25/- per Kg.

Despite the Hon'ble Minister's full efforts, unfortunately, the textile mills have not considered the plight of the knitwear garment units and not even inclined to see the stark reality of the situation, which ultimately has pushed this beleaguered industry into an unviable position.

The Shankar-6, cotton variety spot prices was quoted at Rs.27,700/- on 1st May 2010 and now it is quoted at Rs.29,700/-, an increase of 7.22%. As the cotton constitutes only 60% of yarn prices, the increase in the yarn prices should have been 4.33%.

In contrary to this, the 40s combed hosiery yarn prices which was quoted at Rs.177/- per Kg. on 1st May 2010, has been now quoted at Rs.202/- per Kg, an increase of 14.12%.

It may be noted that after taking into account the increase in cotton prices of 4.33%, the actual yarn price increase should have been only Rs.185/- per Kg against this, the increase was made to Rs.202/- per Kg.

It is clearly evident that the textile mills have not followed the proportionate increase to their inputs and actually, they have been trying to exploit the situation to their utmost advantageous position at the cost of knitwear garment exporters.

We request the Hon'ble Minister to take the stock of the situation and help to put some regulation on cotton yarn exports otherwise, the garment exporting units will not only survive and more number of workers will render jobless, but also, the exports will move out of Tirupur to our competing Countries and thereafter, it will be difficult to bring the buyers back to Tirupur.

Tirupur Exporters' Association (TEA)


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