Sale of cloth and clothes came to a standstill as hundreds of merchants and workers observed bandh on Wednesday in East Godavari district. Merchants, businessmen and shopkeepers including readymade and dress materials shops were closed in protest against the government's decision to bring cloth under the Value Added Tax purview.

In Rajahmundry, Mahatma Gandhi Cloth market in Tadithota, one of the biggest cloth markets in East Godavari, and also Dwarapudi observed bandh along with Kakinada and Amalapuram.

Merchants and shoppers took out a rally from Tadithota to Kotagummam through Main Road and sat on relay hunger strike. Rajahmundry Wholesale Cloth Market Committee president Bommana Rajkumar, Rajahmundry Chamber of Commerce president Pokala Seethaiah, and secretary M. Muralikrishna led the rally and addressed those on the relay hunger strike.

Mr Rajkumar said that the government decision to levy VAT on cloth would result in additional burden of Rs.144 crores on the district. He said that there were about 4000 wholesale, retail and readymade shops in the district and daily they were doing Rs.10-crore business in Rajahmundry. He said that annual turnover of the district from cloth and clothes was about Rs.3600 crores and the government was neglecting the major income source in the state.

Mr Pokala Seethaiah said even though the business community was burdened by several taxes, VAT was going to be an additional burden on cloth merchants and the government should immediately withdraw the tax. TDP leaders Ganni Krishna, A. Apparao, CPI(M) leader Arun and TS Prakash expressed solidarity with the agitation.

Textile merchants observed total bandh and took out a rally on Wednesday from fort junction to Collector's office demanding the government withdrawal of VAT on clothes. The major wholesale textile market (Balaji Market) wore a deserted look following the bandh. Textile Merchants Association president Rama Rao and secretary Shanti Lal led the protesters.

More In: Visakhapatnam