Indian textile mills and exporters hit hard due to fall in global yarn prices, yaun correction as well as glut in the international market. Yarn prices have declined around 30 percent this year compared with the previous year.

The price of yarn is down by Rs 10 on a month-on-month basis and by Rs 30 a kg compared with the corresponding period last year, M Anantha Reddy, general secretary of the Telangana Spinning and Textile Mills Association.

The price of fine yarn (above 30 counts) is now Rs 156 against Rs 176 last year. The two-count yarn is now around Rs 136. The price reduction has eroded the margins for the industry and affected their turnovers.

Also the recent devaluation of the yuan against the dollar by China has also affected the spinning and textile industry in India as about 40-50 percent of the textile production is exported and China is one of the big markets.

But China is striving to push exports by making the pricing of its products attractive in the global markets. With more stocks in hand here, the prices will fall drastically in the absence of corrective measures, said Reddy.

A few players are looking for restructuring of their debt. Stocks of finished goods at mills have increased as buyers refused to lift the stock because of decline in prices, he added.

The textile industry sought three percent incentive for yarn, five percent for fabric and seven percent for garments, made-ups and others finished textile goods under the Focus Market Scheme.

The textile industry is the largest manufacturing sector employing about 105 million people