Financial Storm Hits India Spinning And Clothing Industry

Half of the spinning machines in the V. Kalyanaraman spinning mill in India are idle, with more than 400 workers in the factory, but 1/3 have left.

The Domino effect of Western recession has spread to Southeast India, where textile exports have been reduced and hundreds of thousands of workers have lost their jobs.

Because of the sharp drop in consumer spending, India's textile factories, including the notorious sweatshops and sweatshops, have become the first victims of India's manufacturing industry, which were heavily ordered by American and European apparel retailers.

The textile industry is the second largest job creation industry in India, second only to agriculture. Last year, the number of textile industry employees was 35 million.

But the number of layoffs has reached 700000 this year. According to the report of the Ministry of textile industry, at least 1 million 200 thousand textile workers are out of work by March.

The textile industry is crucial to India's economy.

In the year ending March, the textile industry contributed 4% to India's GDP, 13.5% to India's exports and 17 billion 600 million US dollars in foreign exchange earnings.

In the Tamil Nadu state of southern India, the textile industry is particularly important. At present, the state's textile industry has been hit hard.

At Chandra Textile Co., most of the workers are women from the countryside, and the workers in the factory have laid off 30%. Only 300 workers now, and more workers are unemployed because of the continued decline in US demand.

The company also has a new spinning plant under construction, and the construction works have stopped.

So far, most of the unemployed workers in the textile industry are the lowest skilled workers and the lowest paid workers in spinning mills, printing and dyeing factories, sewing factories and embroidery factories.

Most of these factories employ female weavers, who earn about $2 a day.

Although the law prohibits, there are still many child labourers in these factories.

India's once prosperous economy has slowed down, and financial and technology companies have begun to issue notice of dismissal.

Last month, American Express Company cut 100 India workers, Goldman Sachs Group also plans to cut some of India staff, Goldman Sachs announced that the global reduction of about 10% of the staff.

Motorola, a mobile phone maker, announced in October that workers in India were also planning to lay off 3000 people worldwide.

No industry is not affected, but the textile industry is most seriously affected.

Demand for all textile products began to decrease from the end of last year, including raw cotton.

When the real estate bubble burst in the United States, many Americans no longer buy home textiles, such as carpets and blankets.

This trend is becoming more and more serious and spread to clothing and other products.

Meanwhile, the problem of infrastructure in India has not been solved, so the situation in India's textile industry is even worse.

India Tamil Nadu state accounted for 1/4 of India's textile production nationwide. Last month, electricity usage was only 50% of normal level, and local electricity supply was very tight.

Textile enterprises, such as spinning mills, need to start working all day to make money.

Small city Tirupur is the prosperity Center of India's clothing trade. There are about 3500 garment factories here.

Because of its large export business, it is called "little Japan" by the local people.

Half of the local clothing is exported to the United States.

Now, half of the trucks pporting cotton to factories are empty, indicating a sharp reduction in orders.

The workers cancelled the shift system or reduced the working hours of their clothing factories.

By the end of March 31st, Tirupur exports increased by 15% to 2 billion 200 million US dollars in the last fiscal year, but this year it will be reduced by 20%.

Clothing factory owner Raja Shanmugam said orders have been cut by 20% since September.

Last year, his Warsaw international company employed 800 people and sold 8 million dollars.

This year, it is expected to reduce to $about 5500000.

At present, the local textile industry is lobbying the government to provide support for them.