The weaving industry is reeling under pressure of dwindling sales of grey cloth ever since processing houses in Surat have literally stopped buying the fabric.
"Processing houses in Surat mostly import raw materials like chemicals and dyestuff for processing from China. They have cut down their production by at least 30 per cent ever since the raw materials supply has been affected due to stringent measures by the Chinese government. Which is why weaving units are not able to sell their fabric to these houses, leading to a glut," said Devkishan Manghani, general secretary of Federation of Surat Textile Traders Association (FOSTTA).
There are roughly seven lakh weaving looms in and around Surat. Collectively, units process around 250 crore metres per day of grey fabric, while the city witnesses additional 50 crore metres per day being sourced from Bhiwandi.
Apart from raw material shortage, the processing houses are facing a tough time due to rising fuel costs.
"The skyrocketing crude oil prices have led to tremendous increase in fuel costs for every sector including these processing houses. These houses are gradually cutting down on buying grey fabric by 30-40% which in turn is leading to glut in the weaving units. It won't be long before these units begin closing down," said Manghani.
Through sales of grey fabric to processing houses, weaving units earn a revenue of Rs 15-20 per metres. With sales dipping by 30 per cent, the units are losing revenues worth Rs 15-20 crore per day.
