Country’s largest man-made fibre sector in shutdown mode

Surat: Faced with dwindling demand for polyester fabric, severe payment crisis, unfavourable government policies and a host of other problems, the power loom sector, which contributes to 40 per cent of the nation’s man-made fabric demand, is in a shutdown mode in Surat.
Post-Goods and Service Tax (GST), the condition of city’s power loom sector has turned from bad to worse. While many units have shut in the industrial estates across the city, others have decided to reduce operating hours to just eight hours a day from May 15 until Diwali festival in order to slash production to 70 per cent.

The installed capacity in power loom sector is 6.5 lakh power looms. The production of polyester fabric which was 4 crore metre per day has come down to almost 2.5 crore metre per day post-GST.

A power loom weaver in Pandesara Dilip Patel has shut his 48 machines two days ago. Patel says, “This business isn’t profitable now. I was making losses for the last many months. The traders are not releasing payment on time, which results in escalation of production cost. Thus, I decided to shut the unit.”

There are many small-scale weavers like him who have downed the shutters in the last one month.
Leaders of Ved Road Weavers’ Association organized a meeting on Wednesday to decide future course of action. While majority of weavers wanted to keep the units shut for 20 days, but others suggested slashing of operating hours to facilitate repayment of loans taken from banks.
Ved Road Weavers’ Association president Devesh Patel told TOI, “The ease of doing business is over in power loom sector. The downfall in the sector started with demonetization and it took an ugly shape post-GST. Nowadays, big issues for weavers are payment uncertainty, blockage of crores of rupees of input tax credit refund etc. Weavers of our association have unanimously decided to operate the units for eight hours a day only.”
Pandesara Weavers Association president Ashish Gujarati said, “We have called a meeting of weavers on Thursday where we will take a decision whether to shut the units or slash operating hours. Due to complex GST structure, yarn prices have soared more than 35 per cent. There is no demand for fabrics and a severe payment crisis prevails. The textile industry is facing lots of difficulties.”
by via Surat News, Latest Surat News Headlines & Live Updates - Times of India