Most weavers in Andhra and Telangana regions work with cotton that is bought from the National Handloom Development Corporation (NHDC).

B Syama Sundari, convenor of All India Federation of Handloom Organisations said that the Goods and Service Tax has dented another hole in the handloom sector that is still struggling to keep up with the big players in the market.

The 5 percent GST on cotton yarn has proved to be a nightmare for weavers. Nearly 44 lakh families of weavers across the country are affected as the tax on cotton has spiked the price of handloom products.

Moreover, the NHDC has refused to supply cotton yarn to handloom socities that do not have a registered GST number. J K Suresh, member of Loka Vidya Vedike observed the handloom industry to be the worst-hit sector by GST.

M M Kulkarni, member of a handloom cooperative society that supports 600 families of weavers in Gajendragad said that the cost of thread has increased. A gunny bag of 4.5 kg thread which used to cost Rs300 to 600, but with GST, these rates have now spiked by Rs20 to 50 more per kg.

The cost of the cotton yarn differs based on its kind and sold as bundles (each bundle weighs 4.5 kg). For example, the 80s count yarn used in sarees costs Rs2000/bundle. After the implementation of GST, this rate has spiked by Rs100.