Heavy losses: MSME spinning mills in TN to down shutters from today

Chennai, July 15 (SocialNews.XYZ) The spinning mills in Micro Small and Medium Scale Enterprises (MSME) of Tamil Nadu will down their shutters from Saturday after incurring heavy losses.

There are 2,032 spinning mills in Tamil Nadu of a total of 3,542 mills in the country.

The Spinning mill owners said that for the first time in the last 20 years, the export of yarn and textiles from the state has come down by 28 per cent.

The spinning mill owners said that the main reason behind the crisis is the 11 per cent import duty levied on cotton. They said that the price of domestic cotton was 15 per cent higher and that this has led to India losing several international orders.

Tamil Nadu is one of the major hub of production of yarns and textiles and the losses of international orders have affected the functioning of the spinning mills in the state.

India, according to the Spinners Association of South India has already lost out in export of Yarn, fabric and clothing to neighbouring countries including Bangladesh.

G. Subramanian, President of Indian Spinning Mill association, told media persons that a mill with 10,000 spindles and producing 2500 kg of yarn is incurring a loss of Rs 1 lakh per day.

He said that if the situation persists, then these mills would turn to Non performing assets (NPA) which will lead to permanent closure of these mills.

The Spinning mill owners also requested the government to immediately reduce the interest rates of the banks to 7.5 per cent.

For the past few months, the bank interest rates for loans have gradually increased from 7.5 per cent to 11 per cent that has led to the cost of cotton yarn increasing from Rs 5 per kg to Rs 6 per kg.

Source: IANS