HomeNews20 Textile Processing Units Shut Down In South Gujarat | Surat

20 Textile Processing Units Shut Down In South Gujarat | Surat

SURAT/AHMEDABAD: Though the markets have recovered after the global pandemic and the textile industry has generated good business, some textile processing units in south Gujarat have shut down over the few months as demands for their products saw a drop.
There are 400 textile processing units in south Gujarat and at least 20 big units have shut down. The textile dyeing and printing units that closed down had a production capacity of 1 lakh metre per day and had a monthly turnover of Rs 5 crore.
However, in Ahmedabad, where there is a cluster of some 110 textile processing units, no shutdown has been reported. The units in Ahmedabad are, however, downsizing their operations to a great extent.
“At least 20 textile processing units have closed down over the past few months. They were big players. These units had a turnover of Rs 5 crore per month,” said Jitendra Vakhariya, president of South Gujarat Textile Processors Association (SGTPA).
Of these 20 units, a few have already been sold to recover losses while a few are being used for production of other products. At least three processing units that could not repay loans were sealed by banks, said industry insiders. Drop in demand for textile products has reduced business for the processors. In some cases, it is proving challenging for the functional units to reach the break-even point.
“There is considerable drop in demand for sari, which is the main product that Surat supplies across India. Those units which are working are also facing tough competition and they are hardly making any profit,” said Kamal Tulsian, president of Pandesara Industrial Association.
Meanwhile, in Ahmedabad, the units have downsized their operations. “The demand has declined both in the domestic as well as international market. As a consequence, textile processing units – which mostly carry out outsourced jobs from other textile mills – are out of business. With lack of orders, the capacity utilisation in certain units has plunged to 30% in the past month. Units are primarily functional by fulfilling past orders while fresh orders are missing,” said Naresh Sharma, member, Ahmedabad Textile Processors’ Association (ATPA).
According to him, with cotton prices continuing to remain volatile, grey fabric prices have crashed. “This is impacting the viability of our business and as a consequence, many units are not accepting orders at lower costs as they will result in losses,” Sharma said.
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