According to the South India Textile Research Association (Sitra) about nine million spindles in the country should be scrapped. Out of the 35 million installed spindles in the country, 16 million spindles need modernisation of varying degrees.

The research body has estimated total funds required for modernisation to be carried out at over Rs 10,000 crore.

The issue of excess capacity, first raised by former chairman of Southern India Mills' Association (Sima), BK Patodia, two years back, is now being recognised as a major reason for the poor show of the spinning industry. The glut in the domestic yarn market has resulted in poor realisations for cotton yarn, pulling most units in the organised sector down into the red.

At Sitra's 47th AGM director Indra Doraiswamy claimed, ``Out of the total 29.50 million spindles required to meet theprojected demand in 2002, around 3.50 million spindle new machinery has to become operational.'' The spinning industry's concern about excess capacity also has takers in the textile ministry.

Textile commissioner BC Khatua too had claimed earlier that at least seven million spindles have to be scrapped in the country. Low profit mills, according to Sitra estimates, are almost 40 years old, have an average spindleage of 24,000 and predominantly produce carded yarns in finer count ranges.

According to Sitra chairman M Meyyappan, the slide in profits is mainly due to steep increase in costs of cotton, power and overheads without any commensurate increase in yarn prices.

SITRA, the premier research body for the textile industry in the South, is gearing up to meet challenges of the next millennium setting for itself new thrust areas of research.

The areas identified by the body include technology support for forward integration in spinning mills, help to decentralised sector in technology upgradation,assistance in production of technical yarns and textiles, product development for exports, promotion of cleaner technology in textile manufacturing and human resources development for absorbing new technologies.