The textile industry in the country, already battered by falling exports, will see massive job cuts due to the rising prices of cotton, the Apparels Export Promotion Council of India (AEPC) has said.
"The high prices of cotton have pushed up the cost of the fabric and the end product. We are now in a situation where we are forced to reject repeat orders as we can't justify the high prices to our foreign buyers," Rakesh Vaid, chairman of AEPC, said today.
Vaid's comments come after the government rejected the industry demand for curbs on cotton exports in order to stabilise yarn and fabric prices.
Government rejected the demand saying there are sufficient stocks of cotton in the country. In fact, the government expects a surplus of around 2.6 million bales of cotton, which can be exported.
"The question of banning cotton exports doesn't arise at present," minister of state for textiles Panabaaka Lakshmi had said, adding that domestic consumption of cotton was around 26.4 million bales (of 170 kg each) while production during the 2008-09 cotton season is around 29 million bales.
Vaid said production would go down and may result in unprecedented job cuts in the industry. He, however, did not give an exact figure on the number of jobs that could be cut.