Here we discuss on the impacts that the biggest event of year 2016, demonetization, had on the Indian economy; especially on the textile sector.
On 8th November 2016 government of India had announced demonetization of rs. 500 and rs. 1000 notes, honorable prime minister of India Shri. Narendra Modi had announced the news of demonetization through the live news channels.
India is the largest country in terms of population and textile industry is one of the most major sector which is providing employment to the people, second largest sector after agriculture which is providing employment to the people. Composite mills, apparel, knitting industries, non woven industries etc. When we talk about the special places in India like Gujarat, Tirupur we can say these places as most developed sectors in textiles, where lot of people are working in the industries, some are manufacturing the textile at small units, large units we can see women's are earning good money per day by embroidery work, stitching work etc.
On 8th November 2016 government of India had announced demonetisation of Rs. 500 and Rs. 1000 notes, honorable prime minister of India Shri. Narendra Modi had announced the news of demonetisation through the live news channels. The main aim of government is to bring out the black money and to lead the country towards cashless economy so that there will be a good change in Indian economic. So the new currency has started soon of rs. 500 and Rs. 2000 now Rs. 200 notes too. This action of government has brought various changes in the country like various people have joined the platform of digital payments. Online payments methods have got boost in the recent year, people are now more aware about online payment system all these is leading India to build cashless economy and also making people more aware and helping in understanding the benefits of transaction through digital means also all this is leading to build a good economy of India. Digital payments has increased in the textile sector of Punjab. Almost all the ginning and textile industry has adopted digital payment. However with the advantages there are some negative impact of demonetization on the textile sector of India.
Negative Impacts Of Demonetization
When we talk about only Surat city it has lead to loss of over 5,00,000 employments in the recent year after demonetisation. Most of the textile shops are closed down in the city. The looms which were running 24 hours now cuts to 12 hours a day, the migrated workers from other states who were working in the industries have to go back to their native place due to no job availability at the current moment. Till a year ago Surat produced 40 million meter of synthetic fabric daily. More than 1.5 million workers were involved in the process of manufacturing yarn, fabric, embroidery, packaging, allied services etc. The scenario is changed drastically in the recent year there is down of about 25 million meter fabric now. Almost 400,000 women who would earn rs 300-500 a day by working from home-sewing, stitching or pasting diamond have no work in today's date. Demonetisation has also affected the knitting sectors of Punjab and Ludhiana regions of India, the yearly sales were reduced to half in the recent one year.