Staff Reporter | 17 Jun, 2008
Dr. K.V. Srinivasan, Chairman, Southern India Mills' Association (SIMA) has said that the predominantly cotton-based Indian textile industry is reeling under acute crisis in the recent past due to soaring up of cotton prices.

In a press release the SIMA chairman said that the country has achieved a record crop of 315 lakh bales during the current season. However, the domestic industry could not derive benefit out of the home grown cotton.

On the other hand, the textile mills are facing acute shortage of good quality cotton due to abnormal export and the speculations of international buyers in the domestic market.

The textile mills are not able to break even with the abnormal cotton prices even after the slight increase in the yarn prices, the release said.

Dr. Srinivasan feared that the entire textile industry might come to a halt leaving millions of people in the country jobless if the cotton issue is not addressed immediately.

"The stock to use ratio of cotton in India has gone down as compared to the global level ratio of 45%. The competing countries like China, Pakistan though importing large volume of cotton from India is very cautious on stock to use ratio and maintaining around 35%."

Cotton being a seasonal commodity and purely depends on the monsoon, it is very essential to maintain comfortable buffer stock to manage unforeseen conditions and meet the customer requirements. Tamil Nadu, which accounts for more than 50% of the spindleage is the worst hit, Dr. K.V. Srinivasan added in the release.