SOS: Textile industry in Rajasthan’s Bhilwara bleeding and in dire need of help
The textile industry is bleeding and the current economic slowdown has compounded the woes of scores of textile factory mill owners spread across the country.
India Today visited Rajasthan’s Bhilwara, known as the textile hub of the country, to understand what has been plaguing this once flourishing sector of the Indian economy.
The Indian textile industry currently provides direct and indirect employment to more than nine crore people. It also accounts for 2 per cent of the GDP, which is why the slowdown in the industry, leading to a fall in production and job losses has made the situation extremely grim.
“In Bhilwara, the situation of textile is not good. A lot of slowdown is going on. Our production has gone down by 15 to 20 per cent. We often keep holidays on Saturdays and Sundays, do not operate the industry. Conditions are not good,” Sanjay Periwal, president of Synthetic Weaving Mills Association, said.
The textile industry has been witnessing its worst phase in the last decade or so.
Consider the data for textile industry in Rajasthan’s Bhilwara:
> Fall in Production in last six months: 15 per cent to 20 per cent
> Job losses in Textile industry: 15 per cent to 25 per cent
> As demand has fallen, several factory mill owners have been forced to give Saturdays, Sundays as offs to workers
> Drastic fall in salaries, wages for contractual and non-contractual workers due to lesser working man-hours required
> People being forced to shift out of textile profession, seek menial jobs in order to sustain livelihood
> At least 100 factory mills have either shut shop or taken over by banks due to non-payment of capital loans
> Fall in purchasing power across different economic strata
“Definitely, it has a major impact. The buying capacity of people is not in good conditions. People do not have money to buy cloth. You understand this thing in the manner that a person doing a job for a salary of Rs 20,000 and is given six offs in a month by us, then he is not drawing more than Rs 17,000 to Rs 18,000. In that, he has fixed expenditures. So, he is less interested in buying cloth,” Periwal mentioned.
“Secondly, the globalisation situation that is there, China, Bangladesh, Indonesia and all these countries are giving better facilities than us. The textile clothing from Bangladesh has begun coming to India in huge quantity. So, this must be stopped,” he added.
There are various reasons attributed to the downfall in the fortunes of textile industry, the major ones include: Exorbitant cost of power, huge influx of cheaper products from Bangladesh, China, Indonesia and some other countries.
The economic crisis is directly attributed to:
> Textile industry in Rajasthan has to buy electricity at exorbitant rates of Rs 7.5 to Rs 8 per unit. In comparison electricity is available in Maharashtra at Rs 4, in Punjab at Rs 5, and in Madhya Pradesh at Rs 3.5 per unit. Electricity forms 40 per cent to 50 per cent of production cost in textile industry.
> Influx of cheaper textile products in the market imported from Bangladesh, China, Indonesia where raw material is cheaper and labour available at lower costs.
> Government has not ensured timely payment of Technical Upgradation Fund (TUF) and capital subsidy to textile factory mills.
> Demonetisation and GST have hugely impacted textile industry, marring its growth. Textile industry has not been able to pick itself up since then and is still reeling under their impact.
A job broker Sudip Tahil said, “The situation is turning extremely bad day by day. Our payment is also sinking as factory is shutting down. [If] the party will fail, how will our payment be done?”
“I can tell you about the situation right now. We never even used to have the time to talk during this period. We used to sell 3 to 4 lakh metres of cloth in a month. We had good work of readymade. As compared to 4 lakh, not more than around 1 lakh is getting sold. And even the payment situation in the market is not good,” Periwal further said.