Adilabad, Telengana, has a huge cotton processing industry. It’s considered to be the single largest cotton trading center in Asia with a turnover of over Rs 5,000 crores. As many as six new cotton ginning factories will be added shortly.

In the last few years, five of the biggest ginning and pressing units in town had to be closed down because of huge losses owing to the recession and the consequence of successive crop failures. This had an impact on the growth of the processing industry. Owing to growing competition and decreased productivity and yields, ginning factories with huge processing capacities had faced bad times over the last few years.

Now things are looking up. Units will get a concession in payment of Value Added Tax (VAT). VAT is subsidised at 100 per cent for a period of five years from the date a mill starts processing operations. New units have smaller processing capacities and hence will be viable as the quantum of arrivals of cotton will suit their needs unlike the closed units which boasted of huge capacities.

In the last few years, the processing industry which was mostly concentrated in Adilabad town and Bhainsa saw an expansion in terms of spread in area. Processing units opened almost everywhere in the district in order to capture the local produce.