The Indian textile industry which provides employment to about 10 crore people directly and indirectly and accounts for 2% of GDP, is staring at huge job loss, not seen in last 10 years, claimed an apex body representing the industry.
According to The Northern India Textile Mills Association (NITMA) - an association of textile mills located in Northern India, textiles industry is facing the worst financial crisis and slowdown, which has forced spinning companies to cut down their production and shut down their mills.
“Indian spinning industry is facing the biggest crisis, resulting in huge job losses,” reads an advertisement issued on behalf of NIMTA.
As per NITMA, apart from excess spinning capacity, poor demand for India yarn from overseas markets has led to the crisis. It also blamed “high interest rates” and “state and central taxes on export” for worsening the crisis.
Though India’s cotton-spinning industry has been struggling with profitability over the years, the recent spurt in cotton prices has added to the woes, claimed NIMTA.
Highlighting decline in the export, NIMTA said that during April-June period of this fiscal year, export of cotton yarn fell by 34.6% to $696 million as compared to $1,063 million in the same period last year.
Seeking government’s intervention to prevent job losses, the industry body has pointed out –
Issuing an appeal, NIMTA sought help from the government to avoid the spinning sector from turning into non-performance assets (NPAs). Asking government for “rebate schemes” the industry body has also sought for “two years of moratorium” through the advertisement.
NH tried to get through NIMTA office bears for their comment but failed to get any response till the time of writing this news. Interestingly, Modi government has maintained a studied silence over the issue. Union Minister of Textiles, Smriti Zubin Irani, who is very active on Twitter, has not said anything about the ongoing crisis.
Note: This story will be updated as and when we get response from the NIMTA.