Stalin writes to PM on cotton prices

Chennai,  Flagging the “serious disruptions” faced by the textile industry in Tamil Nadu, Chief Minister M K Stalin has urged the Centre to initiate a series of steps including making mandatory for spinning mills, declaration of cotton and yarn stocks to rein in the price rise.

Despite the Centre notifying withdrawal of import duty levied on cotton, the situation has not improved and prices of cotton and yarn continue to rise, Stalin told Prime Minister Narenda Modi in a letter.

This precarious situation has widespread ramifications for the textile industry in Tamil Nadu. A large number of spinning, weaving and garment units face the danger of closure due to unsustainable demands on their working capital and price mismatch between the agreed price of supply to the buyer vis-a-vis the cost of production,” he said in the letter, released by the state government on Monday.

The growing discontent in the industry and among the weavers was ‘alarming,’ he said and sought for a series of steps to handle the situation.

“As an immediate measure, stock declaration for cotton and yarn may be made mandatory for all spinning mills so that ginners and cotton traders can obtain actual data on cotton and yarn availability,” he told Modi.

He also wanted cash credit limit of the spinning mills to purchase cotton to be extended up to 8 months in a year, as against the existing three.

“Similarly, margin money sought by the banks at 25 per cent of purchase value may be reduced to 10 per cent since banks are calculating the purchase stock value at lesser rates than the actual purchase/market rates in the market,” he added. PTI