The mood in Maharajpur, in West Bengal’s Malda district, about 60 km from the Bangladesh border, is one of quiet anxiety. The majority of the populace consists of weavers, who earn their keep by manufacturing and selling taant (cotton) sarees.
The persistent rise in the price of cotton yarn over the past year, however, has made life difficult for local businessmen, for whom this has translated into a corresponding rise in the cost of production, leading to – besides shrinking margins – a loss of skilled labour.
“Prices of cotton yarn in the past year have increased to about double what they used to be. This has meant increase in costs of production, which have to be compensated by cutting labour salaries,” said Nimai Basak, owner of a taant saree business.
Basak’s business comprises of 18 handloom machines, which are capable of producing more than 10 high-quality sarees a day when operating on full capacity. Half of these are currently unused for want of hands to run them.
“It is impossible for us to sustain payments to weavers, given the higher cost of cotton yarn. Many of them have, therefore , chosen to flock to China, where the pay is much higher,” Basak said.
Most go through illegal channels, on a non-permanent basis, but have no difficulty in finding short-term work because of demand in the larger factories for cloth-making.
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Cotton prices have risen despite the fact that India is set to witness a 12 per cent increase in cotton production, which is slated to touch 325 million bales in 2010.
The situation has been deteriorating progressively since November 2009, when yarn prices jumped 40 per cent. Global supply is expected to fall on the back of low production, causing a spike in the prices of cotton in the international market.
The current year has witnessed progressive deterioration, with small and medium enterprises facing a tangible shortage of cotton yarn along with having to battle high prices.
The average current market price of cotton is around 90 per cent higher than the minimum support price of Rs 23,500 per candy. For the smaller units, it is not just the unused machines that pose problems.
“There is no support from the government, either on the cotton price front, or by way of money. I have outstanding loans of over a lakh and barely any income to pay it off,” complained Anil Basak, the owner of another taant saree business.
The Basaks of Maharajpur sell their produce in the local markets, also known as haats. Many also have marketing tie-ups and contacts with middlemen, who bring their produce to Kolkata for sale at the larger showrooms.