Surat: Power loom weavers are preparing to take on yarn spinners for not passing on the Goods and Services Tax (GST) benefits following the formation of anti-profiteering screening committee in the states by the central government.
The anti-profiteering screening committee, which has been set up by the central government to ensure that the consumer is protected from arbitrary price increase in the name of GST, is headed by GST commissioner from central government Sunil Kumar Singh and additional sales tax commissioner, Gujarat, Supreet Singh Gulati.
The power loom sector had demanded formation of anti-profiteering screening committee as yarn spinners had gone on a spree of increasing yarn prices despite the GST Council lowering GST rates from 18 per cent to 12 per cent. With the formation of the anti-profiteering screening committee, the weavers are preparing the cases of price hike by yarn spinners. They allege that the yarn spinners have formed a cartel and are increasing yarn prices every fortnight by Rs 2 to Rs 3 per kilogram. They alleged that front and second line spinners have gone on a spree of increasing yarn prices, which is main raw material for the power loom weavers. The price hike has come even as there is subdued demand for polyester fabrics across the country and export is dwindling.
In January, the spinners had increased yarn prices by almost Rs 50 per kilogram in nylon filament yarn and Rs 20 in other categories, giving a tough time to the power loom weavers.
Sachin Industrial Cooperative Society Limited secretary Mayur Golwala told TOI, “The GST on yarn has been reduced from 18 per cent to 12 per cent. Instead of passing on the benefit of rate reduction to the weavers, the spinners are continuously increasing yarn prices every fortnight by Rs 3 per kilogram. Now, that the anti-profiteering screening committee has been formed, we will file cases against the yarn spinners for arbitrarily increasing the prices.”
Pandesara Weavers Association president Ashish Gujarati said, “Yarn is a basic raw material and the increase in prices has severely impacted the power loom sector. Even though we are investing in modernized machines, but the cost of raw material is bringing down our net profit margins.”