An investigation by 'The Times' claimed that children as young as 11 years are being paid as little as 6 pounds a month to produce the raw materials used to make garments for sale in Britain.
Buyers of finished garments from southern Indian factories include several big names on the British high streets.
The British daily alleged that children are sold to cotton spinning mills in Tamil Nadu, "locked in for weeks on end and forced to work relentless hours for pitiful wages in dangerous conditions."
"Consumers should ask where their clothes are made, but it's also up to governments like the UK to hold brands accountable," she said.
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When contacted by PTI, the Southern India Mills' Association (SIMA), the apex body of spinners in the region, rubbished the report as totally wrong, saying no textile mills in South, particularly Tamil Nadu, are engaging children below 14 years.
"Some mills do employ persons in the age group of 15 to 18 years, which is permissible in India, where a child labour is defined below 14 years," Selvaraju said.
Officials in the textile association alleged that NGOs, majority of them based at Netherlands, are creating these "cooked up" stories to extract funds by blackmailing reputed brands, both in clothes and garment sectors.
Tamil Nadu contributes 60 per cent of national production and is home to the bulk of India's mills, which employ 400,000 people.