Govt. Steps to Address Crisis in Handloom Sector

As part of the Handloom package, Government has announced a six fold strategy to offer financial support to handloom weavers. Under the Scheme, weavers will be eligible to margin money assistance of Rs. 4200 to Rs. 5400 per head and interest subsidy of 3 percent on loans for a period of 3 years and Weavers Credit Cards will be issued to eligible individual weavers to enable them to access loans upto Rs. 2 lakh in a period of 3 years without any collateral security. Government has convened stakeholders meetings at Ministerial level to assess the slowdown in the industry.

The Cotton Advisory Board (CAB) and Cotton Yarn Advisory Board (CYAB) meetings held on 15th November 2011 assessed domestic mill consumption for 2011-12 at 210 lakh bales down from 240 lakh bales of cotton; and cotton yarn production down from 3900 million kgs to 3200 million kgs indicating the slowdown in textiles industry.

Rank in Cotton Exports

Gujarat, Maharashtra, and Andhra Pradesh are the major cotton producing states in India. Production in the 3 major states was as follows in the last 3 years :

Indian cotton exports were 35 lakh bales in 2008-09, 83 lakh bales in 2009-10 and 70 lakh bales in 2010-11. India is the second largest cotton exporter in the world after USA. With a view to increase cotton exports from the country, the Government of India has placed cotton exports under OGL without any quantitative restrictions.
Government is considering industry representations for a moratorium on loans for capital intensive requests and special relaxation in RBI’s prudential norms to avoid asset reclassification or additional provisioning to address the textile industry slowdown.

Export by Textiles Industry

The textile industry is one of the most labour intensive industries spreading over hand spun and hank woven sector at one end of the spectrum, and the capital intensive sophisticated mill sector at the other. Textile sector provides direct employment to over 35 million people. The exports being made by the sector has a key role in the economy and is one of the mainstays of the national economy.

During the period 2008-09, 2009-10 & 2010-11 the foreign capital earning by this sector was valued at US$ 21.23 billion US$ 22.42 billion and US$26.83 billion respectively. The share of exports of textile & clothing items (including coir & coir manufacturers and jute) in the total export value of the economy was 11.46%, 12.54% and 10.63% for the period 2008-09, 2009-10 and 2010-11. As per latest provisional figure released by DGCI&S, the share of export of textile & clothing items in the total exports value was 9.28% for the period April-July, 2011.

This above information was given by Smt. Panabaaka Lakshmi, Minister of State for Textiles in written reply to a question in Rajya Sabha.