The knitwear garment export sector has started feeling the pinch of hike in cotton yarn price. The segment is going through a tough situation and is finding it difficult to sustain in the competitive global environment, informed Tirupur Exporters’ Association (TEA) President Raja M. Shanmugam. The cotton yarn price witnessed an increase of Rs. 20 per kg this month.
The cotton yarn price hike has added to the woes of already struggling segment post implementation of GST in July last year. The segment has been facing continuous decline in exports on monthly basis as soon as three months’ transition period got over. Overall, a 21 per cent decline was reported in knitwear segment during the second half yearly period of 2017-18.
The continuous decline in knitwear exports has started haunting the segment after it reported average 34 per cent decline in the month of April and May this year as well.
The yarn price hike has come at a time when industry has just started getting itself on the track after lull period of more than a year. In view of crisis being faced by the sector, TEA President urged textile mills to not increase cotton yarn prices and to not stop supply as well. According to Shanmugam, the crisis ridden sector would have cascading effect on textile industry.
TEA President also discussed the issues with Union Minister of Textiles Smriti Irani and requested to mandate the cotton corporation of India to ensure the availability of sufficient quantity, with desired quality cotton to protect the interest of farmers, textile industry, and also employment.
Wrong policies of CCI created this situation stated Shanmugam while discussing the crisis situation with K. Phanindra Reddy, Principal Secretary to Government, Ministry of Handloom and Textiles, Government of Tamil Nadu.