6 lakh workers to suffer as raw material price hike hits Tiruppur garment exports

Chennai, Jan 6 Tiruppur can well be called the garment capital of South India with around 2,000 industries directly exporting their products across the globe and supported by around 20,000 subcontractors who take piece works for the large export units.

The direct exporters and indirect factories employ around 6 lakh workers and according to Tiruppur garment exporters, the business is taking a hit following hike in prices of raw materials.

President of Tiruppur exporters association (TEA), an umbrella body of exporters in Tiruppur, Raja A. Shanmughan while speaking to IANS said: "The cotton yarn prices have skyrocketed and there is a difference of Rs 140 per kilogram in the prices of cotton yarn compared to previous year. The cotton yarn prices per kilo are now Rs 400 which was Rs 260 last year at the same time."

He said that these high cotton yarn prices have led to the difference in pricing leading to losing out in international markets with exporters from Bangladesh and Vietnam gaining at the expense of Tiruppur and other Indian exporters.

The exporters also said that the Centre must remove the 11 per cent import duty per kilogram on cotton yarn.

Majestic Krishnan, another garment exporter from Tiruppur, said that the prices dyes and chemicals are also skyrocketing affecting the export market.

While speaking to IANS, Krishnan said: "We have quite a good order from Europe and other segments but in the prices, we are losing out to competitors from Bangladesh and Vietnam as raw material pricing is high for us. This has led to our prices being higher when compared to the pricing of these countries."

The higher pricing of raw materials have led to several industries preferring not to take the orders as in the end the exports are leading to losses and hence work is coming to a standstill.

Karuppusamy, a worker at an industry at Tiruppur, said: "In the end, we are the losers. If the companies stop working it is directly affecting people like us who are daily earners and without this, we don't know anything else. This is our bread and butter and if the industry stops functioning several families will die as there are no other sources of income for supporting our families."

Tiruppur has several industries that are working for all the known international brands as the high quality of work at affordable pricing has been the major attraction of this garment city and the higher pricing has led to the decline in business.

It is to be noted that the Tiruppur garment industry had an annual turnover of more than 1 lakh crore in previous years and according to exporters if the Government of India does not intervene and sort this out, the death knell of the industry will soon be heard throwing out a workforce of around 6 lakh people. This would also lead to the loss of foreign exchange and the prestigious Tiruppur garment industry shutting down.