Most of the nearly 2,000 textile mills in Tamil Nadu stopped production today as part of a nation-wide call for closure in protest against decreasing prices of cotton yarn and declining demand, resulting in piling up of huge inventories.
The call for a one-day closure was given by Confederation of Indian Textile Industry (CITI), which also called for a production cut back of 33.33 per cent (1/3rd) of existing daily production from tomorrow.
“Nearly 95 to 98 per cent of mills in the state, producing 57 lakh kgs of yarn daily and which constitute 48 per cent of total National production of 120 lakh kg, remained closed today,” Mr. Thulasidharan, chairman, South India Mills’ Association (SIMA) told PTI.
With over 800 rpt 800 mills in other Southern States also joining the strike, there was production loss of another 18 lakh kg of yarn today, Mr. Thulasidharan said.
South Indian mills have a total spindleage of 29 million, with Tamil Nadu alone having 21.1 milliion, which constituted 62 per cent of total spindleage of 44.6 million across the Country, in 3,336 textile mills, he said.
Mr. Thulasidharan also said that the South Indian mills have a piled up stock of over 250 million kg of yarn, 47 per cent of national stocks of 540 million kg, which was eating into the working capital of the textile mills.
Stating that mills would cut back production by one third from tomorrow, he said such drastic steps were needed to ensure a reasonable price and boost sagging demand for cotton yarn.
A review meeting of stakeholders would be convened in the first week of June to take stock of the price and demand position and also to decide future course of action, he said.