The Russia-Ukraine war, hike in cotton yarn prices and freight charges have hit Panipat’s export business by up to 60 per cent this year. Cancellation and halting of orders has put exporters in trouble.
Panipat generally has around Rs 45,000-crore annual turnover, including Rs 15,000 crore from exports alone. Around 450 units functioning here export handloom products, blankets, bed sheets, cushions and hundreds of other items all over the world. Lalit Goyal, president of the Panipat Exporters’ Association, said cotton yarn prices had increased to around Rs 330 per kg from Rs 160 per kg earlier. Open-end yarn, which was earlier available at Rs 120 a kg, had gone up to Rs 170-190 a kg now, he said.
The slowdown in exports started in the beginning of this year. There were hardly any fresh orders from overseas buyers. The previously placed orders were also cancelled or held up by them, Goyal asserted.
“If the situation doesn’t improve in the coming days, textile exporters will lose business worth around Rs 7000-8000 crore this fiscal. That will be a big setback for Panipat-based exporters,” he said. Ashok Gupta, vice-president of the association, said skyrocketing freight charges had increased the production cost by 15-18 per cent. “The economic conditions in America and Europe have led to a slump in demand, thus adversely affecting the Panipat textile industry. If the situation doesn’t improve, employment crisis will also set in,” he said.
The industry
- Rs 45,000-cr annual turnover of Panipat textile industry
- Rs 15,000 cr out of this comes from exports only
- Rs 8,000 cr likely reduction in exports, if the situation does not improve
- 450 textile export units functional in Panipat
The blow
- Rs 330 per kg is the cotton yarn price; up from the earlier Rs 160/kg
- Rs 190 per kg price of open-end yarn; up from Rs 120/kg
- 18% hike in the production cost due to the increased freight charges
Source: https://www.tribuneindia.com/