CHENNAI: The knitwear industry in Tirupur is in severe crisis. Nearly one lakh people are facing job losses. Another 40,000 are facing threat of being laid off in the granite industry. The powerloom sector and the cotton yarn industry are the worst hit, as the appreciating rupee has resulted in fewer export orders, and lesser margins.
The knitwear industry, which had registered Rs 10,000 crore in exports last year, is finding it difficult to maintain the 20 percent growth rate it has maintained for the past few years. They may register a growth of 5 percent.
Around 7,000 jobs are already lost. If the things don’t improve in the near future the job losses will definitely touch the 100,000 figure.
The state accounts for nearly 40 percent of the country’s total export of Rs 4,450 crore. Though the industry had shown a steady export growth, this year the target was scaled down by 25 to 30 percent, and this year it has been further downsized to 5 to 10 percent. Knitwear, cotton yarn and granite exports have all suffered.
The profit margins have declined sharply and China is preferred as the import destination due to competitive prices offered by Chinese exporters. The demand of the exporters for an upward revision of prices by about 5 percent has been met with resistance by the importers, who find the cost of import from China competitive.
In the powerloom sector 30 lakh people have already lost jobs through out the country due to the crisis in the industry.