Question

Why contribution of mill sector has reduced drastically in cotton textile industry?

Answer 1

The contribution of the mill sector in the cotton textile industry has reduced drastically due to the rapid growth of powerlooms and handlooms sectors. Originally, mills dominated production, but their share declined from 81% in 1950-51 to only about 3.5% by 2010-11. This decline happened because:

1. Powerlooms and handlooms expanded quickly, providing cheaper and decentralized production.
2. Powerlooms now contribute about 60% of the total cloth production, meeting both domestic and export demands.
3. The mill sector faced issues such as labor unrest and higher labor costs.
4. Older mills became less competitive compared to decentralized powerloom units which are more flexible and cost-effective.
5. Geographic shifts occurred as the industry moved towards areas with lower labor costs and better resources.