Surat textile body seeks special cell to curb vanishing firms

Concerned by a spurt in the number of vanishing firms, the textile industry in Surat has once again renewed the demand for setting up a separate economic offence cell, specifically for the textile market area.

A delegation of the Federation of Surat Textile Traders Association, the apex body of textile traders of Surat, met chief minister Narendra Modi during his visit to Surat on Thursday, and submitted a memorandum to him in this regard.

"The instances of vanishing textile forms have almost become a daily affair. This is causing huge losses to the textile industry, hence it is crucial to curb these instances," said Mahendra Saluja, the president of the federation.

"While we have initiated measures to create awareness in the industry, we also require support from the government in this regard. The police is already overburdened and lacks expertise to deal with such economic offences. We have urged the state government to fulfil our long-pending demand for a separate economic offence cell for the textile market area," he informed.

"We have also asked the state government to set up a separate court, for dealing only in cases related to Negotiable Instruments Act. We expect some positive development soon, as the chief minister has given assurance to consider our demands sympathetically," Saluja added.

The menace of vanishing firms seems to have assumed dangerous proportions in the last two years. Approximately 150 to 200 textile firms have vanished from the city in the period, causing losses of around Rs 200-250 crore.

Recently, the traders' federation, the weavers' federation and the processors' association, have formed an action committee, which would suggest measures to curb such incidents. Experts, however, believe such incidents could not be stopped fully.

"There are between 35,000 to 40,000 textile firms in Surat. With a few exceptions, these are genuine enterprises. But the problem is that it is difficult to distinguish between the genuine traders and the cheats. The recession in the industry coupled with overproduction makes the job of the cheats easy as they simply gather goods, sell them at throwaway prices and then vanish," an industry expert said.

"There is no way such instances could be stopped completely. However, if the traders and weavers become cautious, make proper verifications before entering into deals, these instances can be curbed," he added.