Madurai Textile Exporters' Association has called for a two-day token strike on September 24 and 25 protesting against the “unprecedented” increase in the price of yarn that affected the textile units, especially the export-oriented industry.
Talking to reporters here on Tuesday, its president, K.P.S. Selvaraaj, attributed the increase of price to Government removing cotton exports from the restricted list. As a result, cotton that was sold for Rs.23,000 a candy (355 kg) three months back was now being sold at Rs.38,000 a candy. This, in turn, hiked the price of yarn from Rs.570 a bundle to Rs.800.
“This is unbearable for the industry,” said its vice-president, M. Britto. Export units were facing a huge loss due to the huge variation in price of yarn there was no match between the cost at which the export orders were taken three months back and the cost of the final products at present.
Mr. Selvaraaj said the traders were exporting yarn to the competitors in garment export, like China, Pakistan and Bangladesh. Mr. Britto said the country could gain more on foreign exchange if garments, instead of cotton, were exported. Export of garments and value-added products could fetch at least three times the foreign exchange that of export of yarn. Besides, the availability of yarn ensured employment opportunity to lakhs of people.
The association has demanded that registration of contracts should not be allowed for exports of cotton during October to December 2010 to ensure that the best quality of cotton was made available for the domestic industry and only the surplus was exported.
Similarly, registration of contracts for exports of cotton in January to September 2011 should be restricted to the exportable surplus of 49.5 lakh bales, as assessed by the Cotton Advisory Board.
Contracts should be registered only for the exports to actual users to avoid stock transfer among traders and hoarding in order to speculate. Cotton should be again brought to restricted list subject in Foreign Trade policy and an export duty of Rs.10,000 a tonne should be imposed.
The association would decide on further course of action, if these demands were not met, Mr. Selvaraaj, said. The association secretary, M. Natarajan, was present.