Textile industrialists in Kannur have burst into a flurry of restlessness after workers of a couple of handloom societies staged a march to the factories of three top exporters on Monday.
About 15 textile exporters in Kannur together clocked about Rs 300 crore business last year. They had targetted Rs 1000-crore exports to 50 countries for 2010.
An agitated delegation of Kannur exporters have rushed to Kerala industry minister Elamaram Karim's doorstep at Thiruvananthapuram on Wednesday to appraise him of the handloom versus powerloom rift.
"Buyers ask for fine-woven fabric, regardless of whether it powerloom or handloom," S Jayachandran (president, Kerala Handloom Export Organisation and president of North Malabar Chamber of Commerce) told FE.
Before January 2005, buyers used to ask specifically for handloom. After that the importing companies lost Central government's product-concession on handloom. Thus Kannur fabrics were pushed to competition with not just Salem weaves, but also with China.
"But then, a social factor that has to be factored in is that Kerala handloom gives direct jobs to 1.5 lakh (mostly women) weavers. More powerlooms could cause loss of jobs," says P Sreekala, a weaver.
When the cost-edge became crucial, the dependency on wage-cost-intensive handloom became a burden that exporters are less ready to shoulder. According to TN Lakshmanan, a handloom producer, the industry had to undertake a partial shift to powerloom to crosssubsidise the galloping production costs from handlooms.
Shopping for powerlooms has set weavers on the rampage. And exporters are worried.
It is a sticky wicket that's emerging for the Kerala government, while trying to showcase a robust industrial climate without losing the good will of weavers. The only way out, probably, will be to jack up domestic demand for handlooms that exporters find too costly.