Weavers cry foul over hike in yarn prices

Surat: Powerloom weavers in the country's largest man-made fabric (MMF) centre in the city are worried as the frontline yarn manufacturing companies have increased polyester yarn (POY) prices by almost seven per cent, effective August 1.

Call it a Goods and Services Tax (GST) effect, the yarn spinners announced the increase in yarn prices from Rs 5 per kilogram to Rs10 per kilogram, compared to prices pre-GST. Leaders in powerloom sector stated that the yarn price hike is phenomenal, while the prices of fabric have been unchanged. The increase in raw material price is going to impact the end prices of MMF fabrics by almost 15 per cent.

"It seems that the yarn spinners are unhappy with 18 per cent GST. There is no rationale behind increasing the yarn prices, when the companies are well aware of the fact that there is no such movement in the market. The price hike is definitely going to hugely impact powerloom sector," Pandesara Weavers Cooperative Society president Ashish Gujarati said.

Gujarati added, "The industry is waiting with a bated breath on the decisions to be taken at the GST Council meeting on August 5. We have put forth demand for refund of accumulated tax credit and removing GST of 5 per cent on weaving job work. Now, the hike in yarn prices, which is basic raw material for powerloom weavers, is a further cause of worry for the very existence of small-time weavers."

Federation of Gujarat Weavers Association (FOGWA) president Ashok Jirawala said, "The frontline spinners are always in a hurry to increase the prices. They should think of the industry first and the situation being faced by small weavers. The price hike of Rs 5 to Rs 10 per kilogram will kill the industry post-GST."

Sachin Weavers Association president Mahendra Ramoliya said, "The 5 per cent GST on job work and 18 per cent GST on yarn were not enough that the yarn spinners have now increased the prices of polyester yarn. This will adversely affect the industry and that the small weavers will not be able to survive."

Source: http://timesofindia.indiatimes.com/city/surat/weavers-cry-foul-over-hike-in-yarn-prices/articleshow/59870885.cms