MUMBAI (Commoditiescontrol) – Textile mills in Madhya Pradesh were still reeling under the demonetization impact as production remained affected almost by 15-20 per cent due to slow arrival of cotton crop in the state mandis. According to M C Rawat, secretary, Madhya Pradesh Textile Mills Association, cotton prices are higher by almost Rs1,500-2,000 per candy compared to normal at this time of the year, since arrival had slumped post demonetization policy. However, arrival was increasing in recent days, which can lead to recovery in production.
The state has 43 spinning and 16 composite mills with a capacity of 24.53 lakh spindles, 32,352 rotors, 4,203 looms and 159 knitting machines. The industry also provides direct employment to 67,164 persons. Roughly, the state accounts for 5 per cent of India’s spindleage. Cotton production during the 2016-17 kharif season is estimated at 20 lakh bales (6 per cent of all-India), of which, 6.95 lakh bales have arrived in various mandis as of 20 December.
Rawat pointed out that labour flight was minimal in Madhya Pradesh as only 5-10 per cent are migrant workers, mostly from Bihar and Uttar Pradesh. He added that normalcy is expected only by January end, but was not confident.
Regarding Goods and Service Tax, the Association has urged the government for a flat 5 per cent duty slab across the textile value chain including garmenting. Rawat said that the association has proposed to bring fabric and hank yarn into the GST net, as leaving out one segment will break the value chain and only increase cost of production making final product dearer for end-consumers.
(By Commoditiescontrol Bureau; +91-22-40015522)
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