Adverse Economic Policies Force Closure of Rajapalayam Spinning Mills, Leaving Hundreds Jobless
2024-04-17 15:27:22
Unfavorable Economic Policies Cause Rajapalayam Spinning Mills to Close, Creating Hundreds of Jobs Losses
A string of unfavorable economic policies enforced by the Central government has led to the closure of several spinning mills in and around Rajapalayam, leaving hundreds unemployed, according to B. Mariappan, a functionary of the Communist Party of India (Marxist).
Mariappan attributes the closures to various factors, including volatile cotton prices, the influx of cheap imported garments, and the failure of the Cotton Corporation of India (CCI) to stabilize cotton prices. He criticizes the CCI for selling cotton to corporates, resulting in hoarding and price hikes, thus defeating the purpose of the organization.
The textile industry in the Rajapalayam region, which comprises 110 spinning mills and employs approximately one lakh workers directly and indirectly, has been severely impacted by these policies. High volatility in cotton prices, compounded by the imposition of GST exclusively on cotton, has further hampered the industry's competitiveness.
Mariappan points out the irony of allowing imports of cheaper garments while domestic textile producers struggle. He suggests that imposing anti-dumping duties and reducing tariffs on electricity could alleviate some of the industry's burdens.
G. Ganesan, district president of the Spinning Mills Workers Union affiliated with CITU, highlights the reduced operational days of some mills due to decreased demand, noting that many are barely operating to avoid loan defaults.
Mariappan advocates for policy changes, including zero input tax on cotton and lower interest rates on bank loans, to support struggling mills. He laments the economic fallout, with many former mill workers now seeking employment in the construction and agricultural sectors, while those who borrowed from self-help groups face challenges in repaying loans on time.
