"Due to non-availability of cotton at an affordable price, 10 per cent of the spindles have stopped working in the spinning mills," said S Dinakaran, vice-chairman, Southern India Mills Association.
Many spinning mills in Coimbatore are on the verge of closure even as raw cotton is getting beyond the reach of domestic players, whereas international market is filled with Indian raw cotton, Dinakaran added, without naming any of the troubled mills.
The Cotton Advisory Board (CAB) has estimated a record production of 31.5 million bales of cotton for the current season. It has also projected the exports for the current year at 8.5 million bales as against 4.7 million bales last year.
The Confederation of Indian Textile Industry (CITI), in a letter to Prime Minister Manmohan Singh, has alleged that the international players are siphoning off huge amount of raw cotton from the market to increase its prices.
"In the present situation, traders are not interested to sell cotton to our mills because they anticipate continued increase in prices because of depleting availability," said the CITI letter.
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However, the ministry feels the traders should buy cotton at an early stage to compete with international players because it is not under the Essential Commodities Act.
"We need to talk to other ministries as well before coming to any conclusion on cotton prices. We will also take the industry's suggestions to take a middle path where the interests of the cotton farmers as well as spinning mills are protected," said JN Singh, joint secretary, Ministry of Textiles.