Trying times for textile town

Problems and challenges seem to be hitting at the very heart of Tirupur , the textile valley of the south. The textile town in Tamil Nadu that is a major exporter of apparels to the US and Europe was first hit by a weakening dollar followed by huge losses due to ill-informed forex derivative positions taken by small and big exporters. All these have resulted in losses estimated to be between Rs 300 crore and Rs 600 crore.

The two financial challenges came at a time when the textile town was re-inventing itself, thanks to high labour attrition forcing local entrepreneurs to look outside Tamil Nadu for both manpower and expanding their operations in states where labour availability is not a bottleneck.

Going by the current level of capacity in the garment producing units in Tirupur, the annual demand for workers is estimated to be between 25,000 and 30,000. The industry currently has an attrition rate of 40-60 per cent. Till a few years ago, there was no other competing industry for labour.

Today, competition not only comes from within the industry, but also from the IT/ITeS companies, who have started setting up their base in nearby town Coimbatore (an hour's drive from Tirupur), says R Kannan, who runs a dyeing unit in Tirupur. Of around 200 employees the company had, 23 left in the last three months to join the IT/ITeS sector.

Kannan says an unskilled worker earns Rs 3,000