The textile sector, like other sectors, is being impacted by the rampant Covid epidemic that is sweeping the country. Due to the ongoing lockdown in many areas, manufacturing has come to a halt since the textile mills have shuttered. As a result demand for cotton and yarn have dipped. In Andhra Pradesh, the spinning mills have reduced production of cotton yarn to 40 per cent due to declining demand in other states.
Some spinning mills operate in two shifts, while others operate in a single shift alone. The state has 120 spinning mills that produce 6,87,884 metric tonnes of cotton yarn each year.
Cotton yarn worth Rs 842 crore is exported to various nations and states. Spinning mills directly employ one lakh people and indirectly employ another four lakh people.
Almost all the spinning mills have reduced 40 per cent of cotton yarn production for the last three months. According to sources in the AP Textile Mills Association, due to the lockdown, textile mills in West Bengal, Gujarat, Tamil Nadu and Maharashtra States are not purchasing cotton yarn.
Every spinning mill on an average has been producing 25 metric tonnes to 30 metric tonnes of cotton during the last three months. Over Rs 350 crore to Rs 450 crore worth cotton yarn stocks are piled up in the spinning mills. As a result the mills are facing working capital problem and unable to pay loan installments to banks, maintenance expenses.
When the Covid-19 cases began to mount, workers in the spinning mills returned to their hometowns, based on their previous year’s experience.
As a result, the spinning mills have to work with the staff they have. The spinning mills will face a major financial catastrophe if the current situation continues.
Speaking to The Hans India, AP Textile Mills Association president Lanka Raghurami Reddy said: “Spinning mills have reduced 40 per cent of the production due to Covid -19 and workers shortage.
At present cotton yarn exports started. If exports will pickup, demand for cotton yarn will increase. If the lockdown is lifted, we will sell cotton yarn stocks. We are eagerly waiting for the release of subsidies of Rs.1200 crore from the State government.”
