The predominantly cotton based textile industry in India has been facing several challenges in recent times owing to higher tariffs imposed on Indian textile products in all major international markets compared to competing nations. Undue delay in disbursing Technology Upgradation Fund Scheme subsidies, volatility and uncertainty in cotton prices, sudden glut in the synthetic yarn market, closure of dyeing units in northern states resulting in accumulation of fabric stock in different power loom clusters have added to the crisis of the sector.

At present, the spinning sector has 10 per cent excess capacity, due to poor demand for yarn exports though there have been improvements in recent months resulting in accumulation of yarn stock and liquidity problems. To discuss various problems being faced by the spinning sector, and to decide on the future course of action to mitigate the crisis, the Southern India Mills Association has convened a meeting of its member mills today.

Spinning in India can be classified into two categories: medium and long staple. Development of new varieties of seeds and adopting advanced procedures of cultivation will add to the profit in the cotton textile sector of the spinning industry.