Tamil Nadu, a textile hub, accounts for one-third of the textile business in the country. The textile mills in the state account for 44 per cent of the total spinning capacity of the country and 60 per cent of its yarn exports. Together these mills earn a foreign exchange of over Rs. 75,000 crores.
The textile industry in the state provides direct employment for over 50 lakh people. Livelihood of several crores of cotton farmers in the country, survival of powerloom, handloom and garment sectors and that of Tirupur knitting and garmenting sectors which account for 70 per cent of the total cotton knitted garments produced in the country, depend upon the competitiveness of the textile mills in the state. Due to fall in cotton prices, Cotton Corporation of India (CCI), in order to safeguard the interests of the farmers, has procured 86 lakh bales of cotton under MSP operations, mainly from Andhra Pradesh and Telangana. However, the CCI has sold only three lakhs bales of cotton and is holding the balance of 83 lakh bales.
According to Mr. T. Rajkumar, Chairman, The Southern India Mills’ Association (SIMA), the association has sent a fax representation to Mr. Santosh Kumar Gangwar, Hon’ble Union Minister of State for Textiles (Independent Charge) stating that though CCI has covered major volume of good quality cotton from Telangana and Andhra Pradesh, it has temporarily suspended sale of cotton and as a result, a large number of textile mills are running short of quality cotton as the same is not available in the open market. SIMA chief has appealed to the minister to direct CCI to immediately commence selling of cotton by e-auction directly to the actual users with liberal credit norms considering the current financial crisis being faced by the spinning mills due to continuing glut in the yarn markets and delay in getting TUF subsidies and other government dues.
Mr. Rajkumar pointed out that the rates quoted by CCI result in speculation as the market prices rule much below the CCI prices and so he appeals to the minister to advice CCI to avoid quoting higher prices than the market prices.