With talks between powerloom units and cloth dealers failing, units in the Coimbatore region have decided to continue their strike.
Around 200,000 powerloom units, mainly the job working units, present on the borders of Coimbatore and Tirupur districts are on an indefinite strike since August 5, 2009, to protest against the reduction in the conversion charge of yarn by 10 per cent. The job workers convert yarn into fabric through contracts given by powerloom cloth dealers.
“We want the old rates back and also withdrawal of the fine of Rs 80 lakh imposed on us by the Tamil Nadu Electricity Board (TNEB) for exceeded power consumption,” Kumaraswamy, president of the Coimbatore Job Working Powerloom Units Association, said.
The cloth dealers cite global meltdown as the reason for reduction in the conversion charge.
“The conversion rate for a metre of fabric is Rs 12-20 depending on the quality. It was reduced by 5 to 10 per cent because of the decrease in overall demand after the slowdown. So, it is not commercially viable for us to give the orders at the previous rate,” Duraiswamy, joint secretary, Coimbatore District Powerloom Dealers' Association, said.
Around 65 per cent of fabric produced in the region is exported directly or indirectly, mainly to the African market. With the slowdown, exports have reduced by 25 to 30 per cent, according to him.
A powerloom can produce around 50 metre of fabric at an average cost of Rs 15 per metre. The powerloom units in the region churn fabric worth Rs 15 crore daily.