Even gazing into a crystalball would not have forecasted the unprecedented crisis pressing the textilemills in the Southern part of India.

 

Until last year, spinning millsin Tamilnadu were running round the clock, and were busy expanding theiroperational capacities. Now, with the export market hit the economic crisis,coupled with a few other factors, the declining foreign orders has pushed thetextile industry of South India is centered into a crisis.

 

Textile mills in Coimbatore accounts for a predominant part of the industry in South India. Presently, amajor part of the spinning mills which involves in manufacturing yarn remainsidle. Several units and closing down, putting the jobs of thousands of theworkers into jeopardy, and many others have not received their wages formonths. 392 mills were closed during the previous year leaving more than 2lakhworkers jobless. Saddled with recession, the industry is tumbling down facing asteep fall in the export orders, especially from the South East Asian markets.The economic liberalization, which was believed to be the pivot of Coimbatore spinning mill's success, is now being blamed as a reason for the industrialturmoil.

 

The corresponding period duringthe previous year was a busy period for the spinning mills in South India. Thespindle capacity was doubled with 40% additional capacity. All these effortshave gone with the wind, with the advent of global recession and power crisis. Thefiscal year 2008-09 is one of the most difficult periods in the history oftextile mills in South India. Cotton yarn production is already down by 20%during the last fiscal year. Production which was 4003.44 million kg during2007-08 dropped to 3239.17 million kg during the last year.

 

Crippling Power cuts:

 

Mills in Andhra faced a power cut of 30%, while mills in Tamil Nadu are facing a power cut of 45%. This hasliterally pushed the manufacturing units in Coimbatore region to the brink.With very little electricity to run the machines, burdened with intermittentpower cuts, the spinning mills operate with minimum capacity. Due to the ongoingpower crisis, mills are running only on 55% of their production capacityresulting in drastic cuts in production and widespread lay-offs.

 

The Government's failure to takeinitiatives to provide relief to the industry has caused agitation among themill owners. Despite the Government's announcement of three stimulus packagesfor the industry, it did not provide any succor to the ailing industry. The 5%tax incentive given to the cotton traders as a part of the stimulus package,only added to the woes of the spinning mills.

 

Like Scylla and Charybdis, globaleconomic turmoil and acute power cuts are pressing down the performance of thetextile units. Increasing prices of cotton and revision of minimum wages, andexport sop for cotton have added fuel to the fire. Textile industry in TamilNadu which accounts for 45% of the countrys spinning capacity is now facingincredible pressure with initiated proactive measures proving futile. Appropriatemeasures must be taken, with due support from the Government to revive theindustry.

 

References:

 

  1. &sec=article&uinfo=<%=server.URLEncode(1834)%>" target="_blank">http://www.hinduonnet.com
  2. &sec=article&uinfo=<%=server.URLEncode(1834)%>" target="_blank">http://www.financialexpress.com
  3. &sec=article&uinfo=<%=server.URLEncode(1834)%>" target="_blank">http://economictimes.indiatimes.com