CHENNAI: MDMK general secretary Vaiko has urged the central government to cancel import tax on cotton and state government to reconsider power tariff hike to help MSME spinning mills in the state.
In a statement, the senior leader noted that MSME spinning mills have announced to stop production and sales of yarn from July 15.
"Spinning mills are struggling due to the increase of cotton price and they could not repay bank loans. They could not meet procurement cost, electricity bill and GST, " he said.
He added that if 700 MSME spinning mills in the state stop operation, production of 35 lakh kilogram of yarn will be affected.
Also, the federation of MSME spinning mills estimated that a revenue loss of Rs. 100 Crore will occur if they stop operations.
"Moreover, 12 lakh persons, who are employed in MSME spinning mills directly and indirectly, will lose their jobs. The central government should waive off 11 per cent import tax on cotton. Interest rate of banks should be reduced to 7.5 per cent, " he urged.
Pointing out the demands of MSME spinning mills federation including reconsidering the electricity tariff hike, Vaiko urged the state government to fulfil all their demands and prevent closing of such units.