The Hindu Business Line : Re appreciation: Textile industry’s employment hit

Mumbai, Nov. 13 The total job loss for the textile industry for the year 2007 touched five lakh with a loss of 35,000 people in April alone due to an 18.25 per cent decline in exports because of the sharp appreciation of rupee, according to a Confederation of Indian Textile Industry release.

CITI, Texprocil, Southern India Mills Association, Synthetic & Rayon Textile Export Promotion Council, Apparel Export Promotion Council and Mill Owners Association among others have requested policy changes to tide over the current crisis. Most companies are cutting back production threatened by the receding bottom lines and some are contemplating an exit, said the release.

More than 80 per cent of India’s textile exports are dollar denominated and with declining exports, the companies have released employees in a bid to contain costs.

The industry foresees further appreciation of the rupee which has risen 15 per cent against the dollar compared to last year. The textile bodies have requested the government to refund the six per cent levy at the State government and municipality levels to the textile and clothing manufacturers and introduce duty-free scrips instead. Withdrawal of service tax from all export-related activity and a moratorium of one year on existing loans are also proposed solutions. Government dues to the textile exporters were requested to be paid with interest to cover the working capital erosion.

Cotton farmers and textile equipment manufacturers are also threatened due to the linkage with the textile industry, it said.

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