Yarn prices not down despite dip in crude oil price: Lakra (India)

The price of crude oil in international market has come down from more than US$ 90 a barrel in mid-May to less than US$ 80 a barrel at present.  However, this has not resulted in a similar drop in prices of synthetic yarn in India.

 

“The crude oil prices have come down but the Government has not initiated any policy to bring down yarn prices correspondingly. The prices of synthetic yarn should decrease by Rs. 10-15 per kg, but the companies have reduced it only by Rs. 3-4 per kg as there is monopoly of some companies,” Mr. Ajit Lakra, President, Knitwear and Textile Association of Ludhiana, told fibre2fashion.

 

“The knitwear industry in Ludhiana is presently facing several other problems. The overall input cost is going up. Secondly, sales are not good as demand has dipped in both the international as well as domestic markets. Owing to slackening of demand, manufacturers cannot increase the prices of their products. So, manufacturers, especially the smaller ones, are suffering,” laments Mr. Lakra.

 

“The unprecedented value-added tax (VAT) and high bank interest rates are also hurting the industry and the small and medium enterprises (SMEs) are in a very bad state,” he adds.

 

“In the absence of any new policy measures initiated by the Government, the knitwear industry in Ludhiana will be declining even more in the next couple of years and there will be lots of casualties among the SMEs,” he avers.