A rise in cotton prices has added to the problems which are already being faced by textile mills, particularly in Telangana, Tamil Nadu and Andhra Pradesh, southern Indian states.
At the beginning of this month, the price of Shankar-6 cotton variety increased from Rs 37,300 per candy of 356 kg to Rs 40,950 per candy on June 20, 2016, showing an rise of almost 10 per cent.
This sudden rise in prices added to the already existing problems faced by textile and spinning mills, such as export slowdown and last August’s devaluation of the Chinese renminbi. The problem is especially acute for those spinning mills which have insufficient stock of raw material. According to media reports, to address this situation, textile and spinning mill owners in southern Indian states agreed to shut down operations twice a week.