A sense of despondency pervades nearly eight lakh households in Tamil Nadu as the economies of Europe and the US have taken a tailspin. Tirupur, one of the twin engines (the other being Coimbatore) of Tamil Nadu’s economy has borne the brunt as clients in Europe and the US have cancelled their orders for non-formal wear in the backdrop of the Russia-Ukraine war. Tirupur was hit hard by the Covid-19 pandemic during 2019-21 and was on the path of recovery when artillery shots fired in Ukraine shook this industrial township in faraway India.
“Tirupur is the knitwear capital of India as it produces 55 per cent of the ready-to-wear oufits manufactured in the country. The district, which has more than 1,200 knitwear factories accounts for 13 per cent of the exports in this sector,” said S Sakthivel, executive secretary of Tirupur Exporters Association.
With bated breath, Sakthivel awaits word from his foreign customers for orders to meet the Christmas and Thanksgiving sales. “The spending power of the developed countries has eroded because of the pandemic and the war. Food, power, and equal monthly installments are the top priorities of the people in these countries while clothing bills have taken a hit. It is no more a priority as it used to be,” explained Sakthivel.
The demand for new clothes in western nations pick up between October-January. J Milton, an entrepreneur and one of the lead exporters in Tirupur says he has not come across such a decline in demand during the last 25 years. “Customers in Europe used to buy clothes which they wear till the fifth washing. After the fifth washing, they dump the clothes and shop for new ones. Not anymore. They want clothes that last for 30 washes. This is because their purchasing power has gone down,” said Milton.
Every world cup football tournament in the past saw participants and fans wearing Tirupur-made jerseys.
“This time there were no orders from anybody and I need not explain more,” said Sakthivel.
Kumar Duraiswamy, a leading entrepreneur says Tirupur is the victim of an economic tsunami. “There is 64 percent fall in sales as buyers are not ordering merchandise. Financial institutions, the main sources of funds, are not offering credit and this has put us in a major crisis. Shoppers are faced with a shortage of $400 per month due to the tightening of the money market,” said Duraiswamy, who strongly believes that a sustained effort by the State and Central Governments could make a lot of difference.
C P Radhakrishnan, textile mill owner, and former Lok Sabha member is of the view that Central Government alone could help the industry as the DMK Government is callous and indifferent in its approach.
“The Union Government should come out with direct help to the industry as the State administration is not interested in saving this sector,” said Radhakrishnan. The DMK Government’s decision to hike power and water tariffs has broken the backbone of the textile industry, he said while asking the banking sector not to penalize the textile and MSME sectors for the delay in paying back the loans.
The recession has dampened the spirit of business barons Milton, Duraiswamy and small-time businessmen like Jitender Parikh. Tirupur, known as a lively city that was energetic 24X7 has turned out to be a sleepy township. Many eateries have downed shutters and shopping centers wear a deserted look. Parikh, a Calcutta-born dealer of textile goods is literally struggling to dispose of the stocks in his shop as there are no customers. “I am tense as I have to pay salary to a dozen workers in my shop. I cannot leave them at this juncture as there are no chances of them getting any employment now. We are in for hard times,” said Parikh.
Radhakrishnan says that a joint effort by the ministries of commerce, finance and industry alone could bail out Tirupur and the eight lakh households. K M Subramanian, president TEA is hoping against hope that the FTA between India and Australia may help to turn around the downfall.
