With the textile industry of India going through a slump due to steep inflation, the demand for yarns have gone down. The textile units in Amritsar, India, are also feeling the heat. Units which have been manufacturing various kinds of fabrics, including suiting, shirting, tweed, blazers, blankets and women’s dress material, are either closed or on the verge of closure.
The Amritsar Yarn Agents Association (AYAA) President, Kamal Dalmia, said the association, which was founded with 60 members in the year 1989, now has only 40 members. This decrease in the count of the members is basically due to closure of the majority of the obsolete units. Moreover, the unfavourable policies of the Government led to the shifting of weaving units to Ludhiana and Bhilwara (Rajasthan).
Yarn agents have been the foundation of the business as they worked as a pivotal link among the yarn manufacturers based in Ludhiana, Hoshiarpur, Haryana, Himachal Pradesh, Kathua in Jammu and Kashmir, and Rajasthan. But the scenario has changed completely now.
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Dalmia said the utilization of yarn has come down owing to scarcity of labour, wrong Government policies and manufacturer’s failure to modernise their units. He further added that the first inflation must be reined in on the lines of China and the banks must also give loans at about 7 per cent rate of interest and income-tax exemption must be raised from Rs. 2 lakh to Rs. 3 lakh.
Likewise, he said that the excise exemption limit has been Rs. 1.50 crore for the past eight years for the textile industry and keeping in view the inflation, it must be raised to Rs. 5 crore because the cost of investment has increased.
Though the capital investment limit of Micro Small Medium Enterprises (MSME) was enhanced in September 2006 from Rs. 2 crore to Rs. 5 crore, yet it needs to be increased to Rs. 10 crore and this will give the advantage of a low rate of interest on loans.
Dalmia said, “The Government offices should deal their cases within the city, import and duties be brought down. The power at Rs. 7.50 per unit is extremely high while new industry would be offered power at Rs. 5 per unit. This would create imbalance in the industry in the state. Archaic labour laws and prolonged legal cases are holding back the growth of the industry.”
