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CHAPTER 3

AN OVERVIEW OF POWERLOOM INDUSTRY AND

ENTREPRENEURS

3.1 INTRODUCTION

The decentralized Powerloom Sector plays a pivotal role in meeting

the clothing needs of the country. The powerloom industry produces a wide

variety of cloth, both greys as well as processed. Production of cloth as well as

generation of employment has been rapidly increasing in the powerloom sector.

There are 22.69 lakh powerlooms in the country as on 31.10.2010 distributed

over approximately 5.11 lakh units. The powerloom sector contributes about

61% of the total cloth production of the country, and provides employment to

about 56.64 lakh persons. More than 60% of the cloth meant for export comes

from the powerloom sector.

3.1.1 Growth in the Powerloom Sector

The estimated number of powerlooms in the decentralized sector in

the country till 31st October 2010 were 22, 69,469. The year-wise growth in

the number of looms installed is given at table 3.1.

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TABLE 3.1

GROWTH OF POWERLOOM SECTOR

Year No. of Powerlooms Growth %age2002-2003 16,92,737 -2003-2004 18,36,856 8.5% 2004-2005 19,02,953 3.6% 2005-2006 19,43,892 2.2% 2006-2007 19,90,308 2.4% 2007-2008 21,06,370 5.8% 2008-2009 22,05,352 4.7%2009-2010 22,46,474 1.9% 2010-2011

(up to 31-10-2010) 22,69,469 1.02%

Source: Annual Report 2010-2011, Ministry of Textiles, Government of India 3.1.2 Cloth production (Million Sq Mtrs)

The details of total cloth production and production by powerloom

sector during the last six years are given at table 3.2

TABLE 3.2

CLOTH PRODUCTION

Year Total Production

production on Powerloom

%age of Powerloomover total

Production2004-2005 45378 28325 62%2005-2006 49577 30626 62%2006-2007 53389 32879 62%2007-2008 56025 34725 62%2008-2009 54966 33648 61%2009-2010 59809 36644 61%2010-2011

(up to 31-10-2010) 35805 22067 62%

Source: Annual Report 2010-2011, Ministry of Textiles, Government of India

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3.1.3 Product Profile

The Powerloom Sector produces a variety of fabrics for domestic as

well as export markets, such as shirting, suitings, dress material, saree, dhoti,

towels, furnishing, shawls, blankets, tweeds etc. made out of cotton, blended,

synthetic, silk, wool etc.

3.1.4 Technology Level

As on 31st October 2010 there are 22.69 lakh looms installed in the

country. Most of these looms are conventional, plain / ordinary looms of old

vintage, with outdated technology, very low speed, marked by low productivity

and manufacturing by and large defect prone and low value fabrics.

3.1.5 Problems faced by the decentralized Powerloom sector

The following problems were observed in decentralised powerloom

sector.

i. Technological obsolescence & small size of units with fragmentation

ii. High power tariffs with uncertain power supply

iii. Lack of credit availability & Poor marketability

iv Low HRD skill levels and poor quality consciousness

v. Globalization of the textile trade & threat of import penetration

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3.1.6 Modernization & Strengthening of Powerloom Service Centre

Out of 44 PSCs, under Textile Commissioner and other agencies, 43

Powerloom Service Centres (PSCs) have been modernized with modern

machines and equipments such as shuttleless looms of types projectile, Rapier,

Airjet, Automatic Cop Changing looms, Drop box looms, Pirn winders, cone

winders, sectional warping machines, DG sets etc. Some of the PSCs already

modernized have been further upgraded and strengthened by providing Airjet

looms, Embroidery machine, Textile design software etc. Few more PSCs are

to be further upgraded during the year. Out of 44 PSCs 14 PSCs are under the

Office of the Textile Commissioner, 25 PSCs are run by different TRAs, 4

PSCs under the KSPDC, Bangalore & one PSC is run by the M.P. State Govt.

3.1.7 Computer Aided Design Centers (CADC)

In order to upgrade the quality and design of the powerloom fabrics

and to enable the powerloom fabrics to compete in international market the

Government has sanctioned setting up of CADC. These centres are expected to

create adequate infrastructure for development of woven design with modern

inputs. The following 17 Computer Aided Design Centres (CADC) have been

established:-

Coimbatore, Karur, Komarapalayam and Somanur (Tamil Nadu),

Surat and Ahmedabad (Gujrat), Solapur, Ichalkaranji, Bhiwandi and Mumbai

(Maharashtra),Bilwara (Rajasthan) and Ghaziabad (Uttar Pradesh), Bangalore

and Doddaballapur (Karnataka), Burhanpur and Indore (Madhya Pradesh) and

Panipat (Haryana). These CADCs help the decentralized and small Powerloom

units to access new designs and improve the quality of the fabric.

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3.1.8 Schemes being implemented for development of Decentralised

Powerloom Sector

3.1.8.1 Group Insurance Scheme to the powerloom workers

Government of India have launched a revised Scheme "welfare of

Powerloom workers through Group Insurance Scheme" in association with LIC

from 1st July 2003. In accordance with the XIth Five Year Plan, the scheme has

been modified by merging the existing JBY Scheme and Add-on GIS w.e.f. 1st

January 2008. As per the modified Scheme, the total premium is Rs.330/- out

of which, Rs.150/- is to be borne by the Office of the Textile Commissioner,

Government of India and Rs.100/- is being paid by the LIC from the social

security fund of Government of India. Only a premium of Rs.80/- is to be paid

by the powerloom weaver for getting the benefits under the said scheme.

3.1.8.2 Group Workshed Scheme

The Govt. of India has introduced a Group Work shed Scheme for

decentralized Powerloom Sector on 29.7.2003, under the Xth five-year plan.

The scheme aims at setting up of Powerloom Parks with modern weaving

machinery to enhance their competitiveness in the Global Market and the same

has been modified. As per the modified Scheme, subsidy for construction of

Work shed would be limited to 40% of the unit cost of construction subject to a

maximum of Rs. 160/- per sq. ft. whichever is less. Ordinarily, minimum 4

weavers should form a group each with 48 modern looms of single width or 24

wider width looms will be allowed to be installed. The maximum subsidy will

be Rs.12 lakh per person. The scheme does not envisage more than 500 looms

under one project proposal.

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3.1.8.3 Integrated Scheme for Powerloom Sector Development

In order to achieve the overall development of the powerloom

sector, Govt. has announced the Integrated Scheme for Powerloom Sector

Development during 2007-08. The scheme has got the following components:-

1) Marketing Development programme for Powerloom Sector

2) Exposure visit of Powerloom Weavers to other Clusters

3) Survey of the Powerloom Sector

4) Powerloom Cluster Development

5) Development and Up gradation of skills (HRD) 3.1.8.4 Technological Upgradation Fund Scheme (TUFS)

The TUFS is the flagship scheme of the ministry of textiles which

aims at making available funds to the domestic textile industry for

technological up gradation of existing units as well as set up new units with

state of the art technology to enhance their viability and competitiveness in the

domestic as well as international market.

3.1.9 All India Powerloom Board

The all India powerloom board has been constituted first as an

advisory body in November 1981, with the objectives of advising the

Government on matters concerning healthy development of powerloom

including the measures to be taken to achieve better productivity, increased

efficiency, improved labour welfare and locational dispersal of powerlooms.

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This board has been reconstituted from time to time. It has the representative of

the Central and State Governments, Powerloom Federations/Associations of

powerloom industry, as its member is headed by the Honourable Minister of

Textiles.

3.2 THE DEVELOPMENT OF POWERLOOMS IN TAMILNADU

The powerloom sector plays a pivotal role in the economic

development of Tamilnadu. The founders of powerloom sector in Tamilnadu

belongs to professional and hereditary weavers family called “Kaikolars”,

“Sengunthars”and “Devangas” who belongs to Coimbatore, Erode, Salem,

Virudhunagar and Madurai Districts. They were initially handloom weavers.

On account of serious crisis in handloom sector, handlooms were converted

into powerlooms. The agrarian caste of “Gounders” also entered into the

powerloom weaving. The other reasons for the growth of powerloom in

Tamilnadu were well developed transportation and infrastructure. The towns

like Madurai, Erode, Coimbatore, and Salem are the major centres of the

powerloom concentration in Tamilnadu.

“What are powerlooms? Basically, they are weaving factories,

which get yarn from and get the cloth processed outside. Typically, these are

small firms since weaving itself is subject to limited economies of scale. They

tend to be small enough to escape the official system of labour regulation.

Being small with low capital need, barriers to entry in handlooms and

powerlooms are not significant.

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It is the time to remember that “Small” has a very flexible meaning

in the powerloom case. They range from units with 6-8 operated mainly with

hired labour but not covered by the factory act, to units with 40 or more high

speed, partly or fully automatic, even shuttles looms and many technical and

modern organizational featured of a modern textile factory. Furthermore, what

the Government calls the ‘powerloom’ is a not exclusively constituted small

firm. ‘Powerlooms’ are a residual category in official classification of sectors,

and like all residuals, a mixed up category. Predominantly, however, the

powerlooms consist of small firms, 10-20 looms could be the model size class.

(Tirthankar Roy, EPW, 18.04.1998).

The powerloom units are neither household nor industrial units but

they are a mixture of both. As the size of the units is generally small, they are

more like a cottage industry in Tamilnadu that have grown out of handloom

weaving households. This is true in the case of all the powerloom clusters like

Coimbatore, Erode, Salem, Karur and Madurai etc. Therefore, its structure is

more akin to handloom weaving by the use of dyed yarn and by way of

conventional warping and, hence, they are termed as tiny and cottage units and

not as an industrial factory.

Among the different states in the south, Tamilnadu has got the

largest concentration on powerloom and the growth of this sector has been

phenomenal in the past two decades. Basically “the south is almost exclusively

a cotton region. The west developed powerlooms in the inter-war period. The

south started late but grew more rapidly in the 1980s and 1990s. The west grew

rapidly when Indian consumers began to substitute cotton for polyester. The

south grew mainly by means of cotton exports. In western India, trade,

processing and production co-exist in the same town. The most important

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examples are Surat, Bhiwandi, Malegaon and Lchalkaranji. In the south, a

small set of towns specializes in trade and processing whereas production stays

widely dispersed even in rural. Finally, the growth of western Indian towns has

been sustained by long distance migration from northern India. In the south,

intersectoral transfers of population and local labour have sustained it.

Location of industry depends, jointly on markets and the quality or

cost of resources. In western India, the pull of markets and certain essentially

urban resources have been stronger than that of quality or costs of local labour

and capital. The comparative advantage of western India consisted in networks

of long distance trade based in Mumbai, Ahmedabad or Surat. These networks

arose from proximity of ports, cotton mills, processing and finishing of cloth.

From 1970s onwards, another factor was added-proximity to plants producing

manmade fibres, especially non-cellulosic fibres. The trade in these materials is

essentially urban. The demands of these trades could be only partly met with

local capital and labour and drew resources from far away into the cities that

had developed these trades.

Local textile agglomerations were significant in South India too, the

best example being Coimbatore. With its spinning, machinery, skilled labour

and good transportation, Coimbatore functions as the counterpart of Mumbai

and Ahmedabad of Western India. That is, the two cheapens certain resources

that the organized sector supplies to the unorganized-yarn, machinery, spares

and sometimes, capital for making new investments in the informal sector. Yet,

the locational pull of these towns is weaker by comparison with the cities in

western India. After all, even today, a great deal of the Coimbatore and Erode

trade merely feeds into the trade based in Mumbai or Ahmedabad.

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The advantage of the south consisted, more than in trade, in the

quality of local labour and capital. The extensive and fairly secure handloom

weaving tradition made local language in weaving dispersed and widely

available. Trade utilized local resources that did not have to travel or remove

themselves from local roots. In this system, towns like Erode emerged as the

main points of trade dealing with looms spread out over surrounding several

thousand square kilometres. In western India too, handloom weavers set up

powerlooms but in South India the connection is extremely close, enduring,

and extends to merchant firms. Nearly all the Erode local merchant firms come

from handloom weaving background. The older and the more solidly-built

houses in the market area did come up from the 1920s, the approximate time

when the “successful handloom entrepreneurs moved from mainly manufacture

to trade”.

The number of powerlooms in Tamilnadu is estimated at 4,37,325

that includes all the registered powerlooms in the state as against 16,66,033

powerlooms in India. With the above number of looms, Tamilnadu is seen to

account for one fourth of the powerloom in the country.

FIGURE 3.1

DISTRIBUTION OF REGISTERED POWERLOOMS IN DIFFERENT STATES

Source: Compendium of Textile Statistics, Ministry of Textiles Publications.

16,66,033 LoomsIndia

4,37,325 LoomsTamilnadu

7,09,438 Looms Maharashtra

3,18,263 Looms Gujarath

2,01,007 Looms Andhrapradesh

and Other States

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3.3 DIFFERENTIATING FEATURES OF THE STATE’S

POWERLOOM SECTOR

The basic difference in the composition of the state’s powerloom

industry as compared to the other leading states of Maharashtra and Gujarat are

as indicated below.

In the state, the powerloom industry is basically cotton textile-based

one and uses cotton yarn for more than 95% of its requirement to produce

different types of textiles. Another major differentiating feature is the

production of yarn dyed fabrics in substantial quantities in addition to grey

fabric production in Tamilnadu. As compared to the above, the major share of

production in Maharashtra and Gujarat is found to be grey fabrics in synthetics

as well as blended materials. The usage of hank yarn is more in the State due to

the production of Yarn dyed fabrics to a larger extent. The State is leading in

the production of home textiles in powerloom as well as in handlooms.

Therefore, the usage of coarse count yarn is predominant. Yet another aspect is

the insignificant usage of synthetic and manmade yarns in the powerloom

sector as compared to the other two leading states of the country. Though there

is production of blended and rayon fabrics in the state, their share is very

negligible in the total fabric production. Unlike the prevailing concentration of

powerloom in two or three centres in Maharashtra and Gujarat, the powerlooms

in Tamilnadu are located in hundreds of villages and small towns, showing a

greater dispersal in urban as well as rural areas. The three districts of

Coimbatore, Erode and Salem are having the largest concentrations where

powerlooms are the major source of livelihood for lakhs of rural population. In

view of the inadequate irrigation facilities in these regions, the farming

community has switched over to powerloom weaving on a major scale.

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3.3.1 Free Power Supply to Handloom and Powerloom Weavers

The Government of Tamil Nadu is implementing the scheme of

providing free power supply upto100 units bimonthly to handloom weavers and

500 units bimonthly to powerloom weavers with effect from 01.08.2006. As on

31.03.2009, service connections are provided to 1,45,393 handloom weavers

and to 1,05,224 powerloom weavers (who run their own powerlooms).

3.3.2 Powerloom Weavers Welfare Board

As announced in the Budget 2008-09, a welfare board for

powerloom weavers has been constituted under the “Tamil Nadu Manual

Workers (Regulation of Employment and Conditions of work) Act, 1982”. A

sum of Rs. 1 crore has been allocated and the welfare measures would be

implemented through this Board.

3.3.3 Upgradation of Powerlooms

The Handlooms and Textiles Department has identified 1000

weavers in the powerloom concentrated areas, such as, Tiruchengode, Salem,

Coimbatore, Erode and Madurai towards upgradation of powerlooms by

providing a subsidy of Rs.5000/- each at a total cost of Rs.50 lakh during the

year 2008-09. This is to upgrade the ordinary powerlooms into sophisticated

powerlooms to improve the quality of products to match international standard.

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3.4 FASTER GROWTH OF POWERLOOM SECTOR IN TAMILNADU

3.4.1 Rise of Spinning Industry and fall of Handlooms

The reasons for the consistent and faster growth of this industry in

Tamilnadu are many. Firstly, the spinning mills have been growing steadily in

the state produce the required low count yarns that are mostly used in the home

textiles. Secondly, there is perceptible shift from handlooms to powerlooms

over the few decades. The handloom weavers have been converting their

handlooms to powerlooms as the viability of handlooms has been diminishing

very fast in the last couple of decades. Most of the handloom weavers in areas

like Salem, Erode, Chennimalai, Karur etc., have been forced to keep up with

the changing times and thus have ingzcrossed over to powerloom weaving.

“The global market has become an overwhelming incentive for new

investments and there occurred a veritable explosion of capacity in cotton

based complexes, the most importantly in the Tamilnadu clusters. This has

been much silent revolution. First of all, the 1990s have seen phenomenal

growth of cotton spinning in Tamilnadu. Secondly, powerlooms making grey

cloth mushroomed in unofficial estimates, which tend to be more reliable than

the official. Tamilnadu loomage expanded from 1, 50, 000 in 1990 to 4,00,000

to 5,00,000 in 1996. Cloth trade, machinery, even processing to a smaller

extent expanded. In western India which had steadily diversified away from

cotton, the revolution has been weaker but a revolution till” (Tirthankar Roy).

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3.4.2 Factors contributing to the faster growth of powerlooms in

Tamilnadu

Powerloom production involves medium technology, the investment

per unit is comparatively very small and the capital output ratio is favourable

and, therefore, handloom weavers are able to switch over to powerlooms

thereby improving efficiency and productivity. Along with reducing the strain

of operation, they could increase the earning from powerlooms. Some of the

extraneous factors such as excise duty on slab basis also induced the outsiders

to step in to the field to derive benefits arising out of such exemption.

In Tamilnadu, at first the handloom weavers to improve their

earnings installed the powerlooms but later they grew with amazing under the

ownership of outsiders. Thus, the powerloom industry in the state has been

initiated in the main handloom centres such as Komarapalayam, Pallipalayam,

Somanur and Erode. Some of the other factors that helped in this growth were

following.

3.4.2.1 Labour

The three districts of Coimbatore, Erode and Salem were water

starved regions where the development of agricultural activities was limited

depending upon the monsoon and rainfall, Coupled with the presence of

weaver communities engaged in handloom weaving in the above areas,

provided abundant and cheap labour for the powerlooms.

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The level of education of local workers and early successes of leftist

industrial unions contributed to this feature. Further, until the mid 1990s,

competition for labour among new enterprises had been keen so that even

though wages were high and rigid and local workers were more comfort loving

than their counterparts elsewhere, collective bargaining was not tested

seriously. From the mid 1990s, there was more uncertainty at the cloth market

and fluctuating putting out rates began to squeeze some of the smaller loom

owners. This situation combined with the above average rates for power has led

increasing number of looms in Tamilnadu. On the other hand, some of the

larger factories and new entrants seem to successfully avoid organized labour.

They relocate, specialize in new types of cloth or indifferent activities such as

processing or replace old looms with fewer modern looms and thus employ a

different contract.

3.4.2.2 Electrification

In Tamilnadu, there have been intensive rural electrification

schemes successfully implemented leading to the easy availability of electricity

at concessional rates. Though the concessional rates were intended for

agricultural activities, this came very handy for the installation of powerloom

units in rural areas.

The scheme of the State Government by providing electricity for

irrigation purposes has also facilitated for putting up of powerlooms in rural

areas. With much ease, any new entrant could put up 8-10 looms unit in his

agricultural field whenever there was no prospect of cultivation. Thus the

mushroom of powerlooms has been phenomenon throughout the rural

landscape of western and southwest Tamilnadu.

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3.4.2.3 Communication

During the 1980s / 1990s, all the rural areas were provided with

facilities of easy road transport extensively. Thus, the major trading centres like

Coimbatore, Erode and Salem have come easy reach of the powerloom

weavers. This facilitated the small powerloom weaving owners having 4 to 10

powerlooms to be in constant touch with vast number of master - weaver

operating from Coimbatore, Erode, Salem and other bigger centres.

3.4.2.4 Master – Weavers

The master – Weavers who were basically engaged in the

production and marketing of handloom cloth with their sound financial and

marketing backing found no difficulty in switching over to powerloom

production. There were approximately 300 such manufacturers in Coimbatore,

200 Manufacturers in Erode and around 150 Manufacturers in Salem during

1990s. Presently, their number has become down drastically. Majority of them

are found to be concentrating on fabrics needed by the export garment

manufacturing units. The areas of grey cloth manufacture in the powerlooms

are mainly concentrated in and around Somanur, Tirupur, Erode, Pallipalayam,

Tiruchengode etc. The sizing units in these areas operate by master-weavers for

the production of grey cloth. There are about 100 sizing units in Somanur area

and another 200-250 sizing units in the surrounding areas of Erode and

Tiruchengode. This also helped in the expansion in the loomage in the

powerloom sector in Tamilnadu.

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3.4.3 Larger share in domestic fabric and home textile market

The State is reputed for its powerloom weaving and produces large

volumes of home textile items that find a market in every nook and corner of

the country. Tamilnadu handloom and powerloom sectors have been producing

different textile items basically cotton material meant for domestic market. Due

to popularity of handloom textile items like grey pieces, bedsheets, towels,

lungies, saree, dhoti and other furnishing materials produced in Erode and

nearby areas in the domestic market throughout the country and also

established market share of the above items, the powerloom have occupied the

above handloom slot and successfully marketing the products in the domestic

market. The market share is also going up for some items. All these have led to

the expansion of the powerloom industry in Tamilnadu.

3.4.4 Providing substantial rural employment

The Tamilnadu powerloom industry provides direct and indirect

employment about 7-10 lakh people and in certain cases the whole family is

engaged in this powerloom weaving. The dispersal of the powerloom is very

widespread in the 15 districts where one can find the powerloom units located

in agricultural fields as well as residential areas and adjacent to vacant lands in

hundreds of villages and semi urban places. Due to this phenomenal dispersal,

the employment opportunities are also ensured for lakh of rural population.

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3.4.5 Cluster and sub cluster details

3.4.5.1 What are industrial clusters?

Powerloom cluster development activities are an attempt to facilitate

the sustainable development of powerloom industry located in identified

clusters in a holistic manner to wean out the weak cluster from producing the

low-end value product at one hand and product innovation and other

diversification on the other end.

Normally, clusters are defined as follows: Clusters are groups of

complementary, competing and independent industries that drive wealth

creation in a region, primarily through export of goods and services. An

industry cluster is different from the classic definition of industry sectors

because it represents the entire value chain of a broadly defined industry from

suppliers to end products, including supporting services and specialized

infrastructure. Clusters are industries that are connected by the flow of goods

and services; which is stronger than the flow linking them to the rest of the

economy and by geographic concentration of the related industries. In the

context of powerloom sector, the powerloom cluster may be defined as a place

where there is a more than 200 powerloom units or more than 2000

powerlooms located within the 50 km periphery and are producing fabrics.

3.4.5.2 Eligible components/ activities

Thus cluster development programme will address the requirements

of the cluster in a coordinated and comprehensive manner. The components

eligible for assistance under the scheme are as under:-

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1. Assistance for engaging a professional agency to conduct diagnostic

study of each identified cluster @ Rs. 2.00 lakh per cluster.

2. Assistance for providing required training to the nominated Cluster

Development Officer (CDO) in the reputed institution @ Rs. 40,000/-

per CDO.

3. Assistance for organizing workshops, seminars, demonstration etc.

@Rs.75,000/- for three such programme per year per cluster.

4. Assistance for publicity (printing of brochures, catalogues,

documentation of samples etc.) @ Rs. 25000/- per issue per quarter or

actuals whichever is lower.

5. Honorarium for a year to the nominated CDO to conduct its activities in

the cluster on need base @ Rs. 5000/- per CDO/ month.

The powerloom industry is mainly concentrated in western and

southern parts as well as some pockets in the northern part of the state that are

mainly semi-arid areas where the agricultural activities are limited but cotton is

grown substantially. Therefore, the textile manufacturing has become a major

occupation in the belt of Coimbatore, Erode, and Salem which accounts for

83% of the looms. Besides, there are some pockets of powerloom centres like

Rajapalayam, Virudhunager, Thiruvallur etc in the Southern and Northern

parts. Out of the total 30 districts in the state, as many as 15 districts have

powerloom units.

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TABLE 3.3

DETAILS OF SUB-CLUSTERS IN SIX MAJOR CLUSTERS

S.No. Cluster Districts of Sub cluster Sub - cluster

1 Coimbatore Coimbatore Somanur, Avinashi, Palladam 2 Erode Erode, Namakkal,

Dharmapuri Komarapalayam, Pallipalayam, Chennimalai

3 Salem Salem Elampillai, Vembadithalam, Jalakantapuram, Tharamangalam, Edapadi, Attayampatti, Rasipuram, Omalur, Tiruchengode

4 Karur Karur, Erode Vellakovil, Kangayam, Mulanur, Muthur

5 Madurai Madurai, Ramnad, Virudhunagar, Tirunelveli

Sankarankoil, Rajapalayam, Virudhunagar, Jakkampatti

6 Chennai Chennai, Thiruvallur, Kancheepuram, North Arcot

Thiruvallur, Kancheepuram, Kurinjipadi, Prodatturpet

Source : Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles Publications.

3.5 DISPERSAL OF POWERLOOMS UNDER SIX MAJOR CLUSTERS

As indicated above, the 4.37 lakh looms in the state are dispersed in

six major clusters or groupings. Among these clusters, the major concentration

is seen to be in Coimbatore that accounts for as much as 1/3rd of the total looms

in the state. This is followed by Salem cluster that accounts for again around

27% that is followed by Erode with a share of 25% of the looms in the state.

These three clusters put together account for more than 83% of the looms in the

decentralized sector. The balance 17% of the looms numbering 73, 450 looms

are dispersed in the other clusters of Karur, Madurai and Chennai. Though

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Komarapalayam and Pallipalayam situated near Erode are larger concentrations

of powerlooms and having processing facilities, the total loomage is reported to

have come down in the area. Otherwise, Erode is the fulcrum of not only the

handloom textile production and marketing but also the hub of all powerloom

production and marketing activities in the state. The cluster wise spread of the

powerlooms may be seen below.

TABLE 3.4

DISPERSAL OF POWERLOOMS IN SIX MAJOR CLUSTERS

S.No Cluster No. Of Looms % of Looms1 Coimbatore 139430 31.88 2 Erode 107445 24.57 3 Salem 117000 26.75 4 Karur 28150 6.44 5 Madurai 22800 5.21 6 Chennai 22500 5.15

Total 437325 100.00 Source:Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles

Publications.

FIGURE 3.2

ESTIMATED NUMBER OF LOOMS

32%

25%

27%

6%5% 5%

Coimbatore

Erode

Salem

Karur

Madurai

Chennai

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3.5.1 Specific Pattern of the industry in the six clusters 3.5.1.1 Coimbatore

This district is the most industrialized district in the state. In

addition to the textile industry, the engineering industry also is quite developed

which support the textile manufacturing industry and vice versa. The growth

and concentration of textile industry in the district has helped the growth of the

industry engaged in the manufacture of machinery and tools for use in the

textile industry. Also the handloom production is having a significant presence

in this area. Coimbatore is noted even today for its handloom fabrics. These

have contributed in no small measures towards establishing the industrial base

of the district’s economy. Coimbatore city has rightly been called the

Manchester of South India and could be compared with Mumbai or

Ahmedabad in the West as regards the textile industry is concerned. The

growth of textile manufacturing units and their concentration in Coimbatore

has been rather remarkable. The enterprising nature of the people has helped

the growth of different industries in the district. Coimbatore cotton sarees are

much in demand in the market. Among the major industries that have made a

mark in the district, cotton textile industry is the most important because of

large concentration of spinning. Further, the weaving textile industry had come

to occupy a place of unique importance in the industrial field in the district.

Also as a recent development, the processing of yarn and fabrics carried out in

units with modern technology catering to the weaving sector.

The number of looms on the outskirts of the city reported to be less

than 2000. Somanur is the major sub cluster nearer to Coimbatore which is

reported to have around 1, 00, 000 powerlooms. The powerloom service centre

(PSC) of SITRA is also located in Somanur. The major variety produced in this

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cluster is grey fabrics. Therefore, a majority of the sizing units are located in

and around Somanur that also cater to the looms located even in Avinashi,

Palladamn etc. It is to be stated here that 75% of the grey fabrics produced in

Somanur is exported after dyeing and printing process. The strength of the

powerloom industry in this area is versatility and low cost of production as

compare to other places. An indicative spared in the cluster is as shown below.

TABLE 3.5

CLUSTER COMPOSITION DETAILS OF COIMBATORE

S.No Sub Clusters No. Of Looms1 Somanur 894982 Karumathampatti 1200 3 Kannampalayam 2500 4 Chinniyampalayam 1800 5 Arasur 5606 Avinashi 9012 7 Annur 3400 8 Palladam 235009 Tirupur 1500

10 Managalam 5000 11 Udumalpet 25012 Pollachi 50013 Nearby areas 750

Total 139430 Source:Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles

Publications.

3.5.2.2 Erode

Erode is situated on the river Cauvery, which is popular of the

hndloom products and also home textile like lungi, towels, bedsheets etc. Erode

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has a place of unique importance in the industrial map of Tamilnadu with over

60% of the population depending upon non-agricultural sector. Industries and

trade naturally occupy a place of prominence in the economy of the district.

Industries that flourished in early days in the area were handloom weaving,

carpet manufacturing, cart manufacturing, oil processing, and brass vessel

manufacturing etc. though these industries flourished well in early days, the

advent of modern times changed the fate of some of these well established

ancient industries. The industry which has been able to totally withstand the

onslaught of modernization has been the handloom products. Erode textile

market is nationally important as the total handloom and powerloom textiles

are marketed substantially through this market. The cotton textile industry in

Coimbatore and handloom industry in Erode have encouraged the growth of

various ancillary industries to meet the needs of the textile mills. Chennimalai,

Erode, Gobichettipalayam, etc. are important centres where cotton ginning is

carried out on large scale. There are also important dye works in Erode,

Chennimalai and Bhavani. A number of factories engaged in cotton fabric

printing are functioning in Erode industrial estates have been setup at Erode

and other places where full facilities are offered to small industrialists.

The total number of looms in this cluster is estimated at 1, 07, 445.

Erode and surrounding areas have around 5000 looms that are located in places

like Soorampatty, Veerappanchatiram etc. Large number of the powerloom is

located in the nearby Pallipalayam and Komarapalayam sub clusters where

around 65,000 looms are engaged in textile weaving. The major varieties being

produced in Komarapalayam area are Dhoti, Lungi and grey material. Even in

the handloom centre of Chennimalai, there are around 2000 powerlooms

producing different types of home textiles. In this cluster, the production of

dyed varieties as well as grey fabrics is predominant.

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TABLE 3.6

CLUSTER COMPOSITION DETAILS OF ERODE

S.No Sub Clusters No. Of Looms1 Erode 3509 2 Perundurai 8500 3 Vijayamangalam 5061 4 Avalpoondurai 1721 5 Bhavani 2838 6 Andiyur 5110 7 Sivagiri 662 8 Thandampalayam 6489 Sathiyamangalam 9106

10 Chennimalai 1500 11 Pallipalayam 20000 12 Komarapalayam 45000 13 Nearby areas 3790

Total 107445Source: Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles

Publications.

3.5.2.3 Karur

The textile products of Karur are well known throughout the world

and demand for them is growing at faster every day. Karur, an industrious town

nestled in riverside basin in the state is perfect blend of tradition, creativity,

culture, tropical and most importantly an unparalleled blend of enterprise and

vision. Karur, a small town with a population of around 2, 00, 000 today

commands a reputed place in the export map of India and the world as well.

The Karur textile industry based on home textiles got momentum in the late

1970’s with the orders from foreign buyers starting to come. The Karur

exporters have started concentrating on new designs and techniques in heavier

fabrics and high quality home textile products. For the last one decade, the

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Karur merchant exporters are making direct exports. The PSC of SITRA is also

located in Karur.

The handloom industry has been a traditional occupation of this

district. This industry flourishes in Karur. A production centre has been set-up

at Karur with an installed capacity of 942 looms. This project which was set-

up by the Government of Tamilnadu at a cost of Rs.40.75 lakhs produced 5.71

lakh meters of handloom fabrics valued at 53.80 lakhs. The major item of

production by the weavers of the cooperative societies consist of cotton sarees

and dhotis of 80, 100 and 120 counts. Besides, woven in Karur area popularly

known as “Karur bed sheets” are known for their designs and variety.

The estimated total powerloom in this cluster are 28,150. The

number of looms on the outskirts of the city is reported to be less than 2000.

Vellakovil is the major subcluster nearer to Karur, which is reported to have

around 9,500 powerlooms. The major variety produced in this cluster is dyed

bed sheets, towels etc. Mulanur also one of the sub clusters nearer to Vellakovil

sub cluster is reported to have around 5,500 looms.

There are 400 manufacturers / suppliers located in Karur who

supply to merchant exporters of Karur as well as Mumbai, Delhi, Kolkata,

Panipet etc. the total exports from Karur is estimated at Rs.1100 crores, thus

totalling Rs. 1400 crores worth of textiles annually. In Karur itself there are

140 direct exporters though the total registered exporters are 400 in number.

Among these exporters, 50 of them are doing consistent export and are well

established. The production from this centre is also marketed from Erode where

the turnover is to be Rs. 1 crore daily.

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TABLE 3.7

CLUSTER COMPOSITION DETAILS OF KARUR

S.No Sub Clusters No. Of Looms1 Karur 2800 2 Velayuthampalayam 1000 3 Thennilai 8004 Paramathi 6005 Chinna Dharapuram 7506 Vellakovil 9500 7 Muthur 1700 8 Mulanur 55009 Kangayam 3500 10 Others 2000

Total 28150Source:Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles

Publications.

3.5.2.4 Salem

This salem has along been lagging behind in industrial

advancement. But taking the advantage of the rich mineral deposits in this

districts, the tempo of industrial development is picking up. The recently

established Salem Steel Plant by Steel Authority of India is a significant

industrial landmark of the district. Further, handloom industry occupies a

pivotal place in the economy of Salem district. Next to agriculture, it provides

livelihood for 5.15 lakhs people in the district. The industry flourishes mainly

in the taluks of Salem, Tiruchengode and in few villages of other taluks. The

major items of production in this district are grey fabrics, dhotis, bed sheets,

towels etc.

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Basically in this cluster also, the textile weaving has been popular

with a few communities who are having knowledge of Kannada/Telugu in

addition to the local language. These weaving communities are engaged in this

textile manufacture traditionally for decades and are having wide knowledge in

dyeing, weaving, and designing. During the development of the industry,

people from other communities also have taken up this powerloom weaving as

their occupation. Powerloom weaving is a way of life for these people rather

than an occupation or an industry. The whole family is engaged in different

activities of weaving and the earning is a major sum just enough for their

existence only.

The estimated total powerlooms in this cluster are 1,17,000. There

are some 9 sub clusters with larger concentration of looms. A large number of

powerlooms are producing grey fabrics and bed sheets. The cluster

composition details are presented below.

TABLE 3.8

CLUSTER COMPOSITION DETAILS OF SALEM

S.No Sub Clusters No. Of Looms1 Salem 100002 Elampillai Vembadithalam 150003 Jalakantapuram 8000 4 Tharamangalam 4000 5 Edapadi 7000 6 Attyampatti 100007 Rasipuram 6000 8 Omalur 2000 9 Tiruchengode 55000

Total 1,17,000

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3.5.2.5 Madurai

Madurai is famous for its Meenakshi Temple as well as for

handloom textile and spinning mills. The popularity of chungidi sarees extends

to the nook and corner of Tamilnadu and the whole of South India.

The total estimated looms in this cluster are 22,800. In Madurai

area, the powerloom centres are located in the districts of Madurai, Ramnad,

Virudhunagar and Tirunelveli districts. In Madurai district, the powerlooms are

concentrates in nearby Andipatti and Jakkampatti. In Ramnad district, the

major concentration is in Aruppukottai and nearby areas. In the case of

Tirunelveli district, Sankarankoil and Rajapalayam are the major powerloom

centres. In smaller places nearer to the above concentration centres also the

powerloom weaving units are operating and producing different textile

products. The products range grey fabrics / surgical cloth to dyed piece sarees,

dhoti, lungi and home textiles. The details of the sub clusters are given below.

TABLE 3.9

CLUSTER COMPOSITION DETAILS OF MADURAI

S.No Sub Clusters No. of Looms1 Andipatti 2200 2 Rajapalayam 2500 3 Dhalavaipuram 1000 4 Aruppukottai 1600 5 Chatrapatti 7500 6 Srivalliputhur 300 7 Shankarankoil 2000 8 Puliankudi 500 9 Karivalamandanallur 500 10 Nearby areas 4700

Total 22800 Source:Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles

Publications.

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3.5.2.6 Chennai

Chennai being the capital of Tamilnadu is surrounded by pockets of

powerloom production centres within a radius of 100-200 kilometers. Within

the city as well as nearby areas, there is a larger concentration of exporters

especially apparel manufacturers using silk variety of yarns. The demand for

better quality fabrics from these manufacturers has resulted in the

establishment of up to date weaving units producing silk dyed fabrics. In the

nearby suburban centre of Thiruvallur, there is a major concentration on

powerloom units and yarn dyeing as backward integration is growing day by

day.

The major varieties manufactured in this cluster are dyed silk sarees,

silk dhotis etc. in the areas bordering Andhra Pradesh, there are certain pockets

of traditional weaving centres which have converted into powerloom fabrics

production. Madras has been popular for the production of handloom silk

sarees that has been expanded to the production of powerloom silk sarees. All

these units are catering the needs of domestic as well as exported.

The estimated total number of powerlooms is 22,500. The number

of looms on the outskirts of the city is reported to be less than 2000. The major

sub clusters in this area are Prodattupet and Ammiarkuppam. The details of the

sub clusters in this area are as given below.

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TABLE 3.10

CLUSTER COMPOSITION DETAILS OF CHENNAI

S.No Sub Clusters No. of Looms 1 Chennai 2000 2 Prodatturpet 10000 3 Ammiarkuppam 5000 4 R.K. Pet 2000 5 A.J. Pet 1000 6 Sholingar 1000 7 Sarkarpet 500 8 Kancheepuram 350 9 Thiruvellur 400 10 Kurinjipadi 250

Total 22500 Source:Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles

Publications.

3.6 OVERALL GROWTH OF THE SECTOR AND ITS SIZE

STRUCTURE

The growth of the powerloom sector in the state has been

phenomenal during the last 4 decades beginning from 1970s. Due to the

stagnation and sickness being witnessed in the mill sector and also the

introduction of synthetic fibres in large quantities in the country, the

powerloom sector started mushrooming and taken the lead.

As compared to other leading states, the industry has been growing

at a faster rate in Tamilnadu. Though the growth of powerlooms in

Maharashtra and Gujarat averaged 2% per annum, the annual growth rate, the

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number of looms in Tamilnadu has gone up from the level of 2 lakh in 1990 to

4.37 lakh (estimated) by the year 2002. As gathered from the local

organizations in Somanur, about 10,000 Powerlooms have reportedly been

installed during a span of six months and at the rate of 50 looms per day, the

new looms are being added in the powerloom sector in Somanur alone. All

these go to prove that in certain clusters like Somanur, Palladam, Karur etc.,

the additions to the industry is faster. In other clusters, such growth is observed

to be not so significant.

3.7 POWERLOOM CO-OPERATIVE SOCIETIES IN TAMILNADU

In order to get the support of the Government for their existence and

development, the small and tiny units have been encouraged to form co-

operative societies in the state. As the handloom co-operative societies are

dominant in the state and some of them were also having powerlooms, the

formation of powerloom co-operatives has been made easy.

Though currently there are 142 powerloom co-operative societies

that are registered under co-operative society act in the state, only 90 societies

are functional at present. The district wise breakup of the societies is as given

below.

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TABLE 3.11

DISTRIBUTION OF CO-OPERATIVES IN DIFFERENT DISTRICTS

S.No Name of the District No. of Powerloom co-operatives societies

1 Coimbatore 302 Tirupur 203 Erode 304 Salem 75 Tiruchengode 246 Thiruvallur 347 Tirunelveli 48 Madurai 79 Virudhunagar 210 Vellore 511 Karur 112 Kanyakumari 113 Dindigul 114 Ramanathapuram 115 Kumbakonam 1

Total 142Source:Status of Powerloom Industry - Tamil Nadu, Ministry of Textiles

Publications.

The powerloom societies are mostly dependent on the Government

for their day to day functioning.

3.7.1 Nature of functioning of the societies

Till the year 2000, these societies were getting orders from the State

Government for manufacturing dhotis and sarees which were meant for free

distribution of the power households during pongal festival. However, this

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scheme is discontinued from the year 2001 and therefore; the powerloom

societies were not getting any order from the Government. Most of the

societies are in bad shape and few of them are on the verge of liquidation.

Presently, they are executing private orders from Master-weaver /

Manufacturers. The total numbers of powerlooms weavers’ cooperative

societies were also mainly producing the cloth required under free supply of

uniforms to school children scheme.

It is to be mentioned here that the activities of powerloom

cooperative societies is to be strengthened for its survival. At present

cooperative societies work only on Government orders and are not allowed

producing for private market. They should be given freedom to accept orders

from private traders and businessman and may be allowed to fix wages

according to the cost of the product.

3.8 GOVERNMENT POLICY NOTE 3.8.1 Policy Note 2009-2010

A provision of Rs. 533.93 crore has been made in the Budget

Estimate for the year 2009-10 under Demand No.17 Handlooms and Textiles.

In those, Powerloom Sector had pivotal role and its allocations are reproduced

below.

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TABLE 3.12

SCHEMES FOR POWERLOOM WEAVERS

S.No Name of the Scheme Budget Estimate 2009-10 (Rs. In Lakh)

1Free Distribution of Dhoties and Sarees Scheme (includinghandling charges of Co-optex)

26880.00

2 Free Electricity to Powerloom Weavers 6684.00

3 Powerloom Census (Rent for Powerloom Service Centre, Erode) 0.25

4 Assistance to PowerloomWeavers’ Welfare Board 100.00

5 Assistance for MarketPromotion Activities 4.00

6 Weavers-cum-Designer Project 15.00

Source:Handlooms and Textiles Policy Note for the Year 2009-10, Demand

No.17.

3.8.2 Policy Note 2010-201186

3.8.2.1 Tamil Nadu Powerloom Weaving Workers’ Welfare Board

In order to implement various welfare schemes for the powerloom

weaving workers, the Government of Tamil Nadu have established the

“Tamilnadu Powerloom Weaving Workers’ Welfare Board” on 13.07.2009

under Tamil Nadu Manual Workers (Regulation of Employment and Condition

of Work) Act, 1982. Financial Assistance such as accident insurance benefit,

insurance benefit for natural death, assistance for funeral expenses, educational

assistance, marriage assistance, maternity assistance, assistance for purchase of 86 Handlooms and Textiles Policy Note for the Year 2009-10, Demand No.17, 2011.

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spectacles and pension benefit are being provided to the powerloom weaving

workers through this Board. So far 1,10,026 powerloom weaving workers have

been enrolled in this board and 22,872 powerloom workers have been assisted

with various benefits for a sum of Rs.4.72 crores.

3.8.2.2 Implementation of Free Power Supply to Powerloom Weavers

Free power supply up to 500 units for powerloom sheds with effect

from 01.08.2006 is being provided bi-monthly. So far, 1,17,580 powerloom

sheds are getting benefits under this scheme. In the Revised Budget Estimate

2011-2012, Rs.50.74 Crores has been allocated for implementing this scheme.

3.9 PROFESSIONAL BODIES FOR THE DEVELOPMENT OF

POWERLOOM INDUSTRY OPERATING IN TAMILNADU

3.9.1 Powerloom Development and Export Promotion Council

(PDEXCIL)

Powerloom Development & Export Promotion Council is set up by

the Ministry of Textiles, Govt. of India in the year 1995. The council has been

registered under Section 25 of the Companies Act, 1956, having its Registered

Head Office at Mumbai, Maharashtra& Regional Office at Erode, Tamilnadu.

The main objectives of the PDEXCIL are to promote, support, develop,

advance and increase powerlooms and export of powerloom fabrics and made-

ups thereof and to carry out any such activity in such manner as may be

necessary or expedient.

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PDEXCIL organizes various Capacity Building Programs, Training

programs and Exposure Visits where in persons are taken to another

Powerloom cluster for exposing them to upcoming technologies, market trends

etc PDEXCIL also participates in promoting different schemes of Government

of India such as Group Insurance Scheme (GIS) for powerloom weavers,

Technology up gradation fund scheme and other schemes from time to time.

PDEXCIL with financial assistance from Government of India has

also established Design Studio at Erode for providing training and filling the

skill gap in the industry. The training programs aims to elevate the standard of

the manpower with programmes such as ERP (Enterprise Source Plant). Apart

from the centralized design studio centre at Erode, the scheme will be

expanded to remote village areas from where physically challenged / woman

population / uneducated population will not like to come out freely. Our

satellite training team will penetrate to such remote area also and will give

every fair opportunity for them to avail the benefits of our training

programmes. PDEXCIL plans to open more of such training studios at different

location PDEXCIL represents the powerloom industry at various levels and

have been promoting and advocating issues which are conducive for the

development of Powerloom Industry. Powerloom Manufacturers in SSI

whether or not they are exporting are requested to become member and make

this body stronger so that they can take any issues related to the Powerloom

industry more strongly with Ministry/Government of India.

3.9.2 Powerloom Service Centres (PSCs)

Decentralized Powerloom sector is the major fabric producer and

employment provider in our country. Govt. of India, Ministry of Textiles has

108

been supporting this sector in various ways by providing different financial

schemes for modernisation, growth and development. One major such support

is establishment of Powerloom Service Centres (PSCs) to provide technical and

other guidance to this sector. These centers are spread all over the country at

various clusters of powerlooms. These PSCs are operated by various agencies

and Government.

Fourteen Powerloom Service Centres (PSCs) are functioning under

the Office of the Textile Commissioner and 25 PSCs are functioning under

different Textile Research Associations (TRAs) – the Ahmedabad Textile

Industry’s Research Association (ATIRA), the Bombay Textile Research

Association (BTRA), the South India Textile Research Association (SITRA),

the PSCs trained 4,854 people, developed 3,326 designs and tested 61,578

samples, generated revenue of Rs. 60.63 lakh, and organized 243 exhibitions,

seminars and workshops. 3.9.2.1 Type of Services Provided

The Powerloom service centers providing various services such as,

training of weavers, jobbers, fitters, designers and other operatives of the

powerloom sector and of sizers and back sizers of the decentralized sizing

sector, Training of entrepreneurs of the powerloom and the sizing sectors,

Technical assistance and Consultations in improving productivity & efficiency,

reducing fabric defects & wastage, optimizing costs, running new or difficult

fabric varieties, renovation/modernization of machines, rehabilitation, etc.,

Testing of yarns, sized yarns, fabrics, spares, accessories, etc., Analysis of

fabric defects and providing guidance for eliminating/minimizing these defects.

Development of weaving designs, Providing various types of information about

Government schemes and policies, new developments, announcements, etc.,

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Liaison visits to the units and their Associations for establishing regular

contacts with this sector to understand their problems, provide guidance and

help in solving these on the spot, acquaint them with relevant information, etc.,

Coming out with publications and preparing written material, slides, films, etc.

for up-dating knowledge and providing training to the workers and the

entrepreneurs of this sector, Carrying out survey on various aspects of this

sector, such as unit sizes, loom types and their details, fabric varieties and their

particulars, production rates, types of accessories and their service lives,

closure of units and their causes, etc. and also on various aspects required by

the Government from time to time, Conducting seminars, workshops, meetings,

short duration courses on topical subjects, Carrying out programmes for cluster

development activities for making this sector globally competitive and any

other activity as per the requirement of this sector for the development of

powerloom industry. 3.10 CONCLUSION

The powerloom sector witnessed with sustainable development till

2007-08. Due to subprime loan and economic recession in USA, Many

manufacturing sectors were affected including powerloom sector. In 2009-

2010, the operation of powerlooms was slowdown and it faces a tough time.

The present entrepreneurs in powerloom sector concentrate more to indebt

moderisation and strengthening the powerloom sector with a help of computer

aided design centers (CADCs). The Government too offer various facilities on

subsides rate as well as free power supply to enhance the operations of

powerloom industries. The present chapter covers a bird’s eye view on

dispersal of powerlooms in the study area under six major clusters. The unique

features of each cluster to establish powerloom industries are furnished in this

chapter in detail.