Silk city loses lustre

KB Shivakumar stares despondently at his mounds of white silk cocoons at the government-run Ramanagaram mar ket. The auctioneer has sealed his fate: the produce will sell for only Rs 165 per kg. “The same lot, two to three weeks ago, would have fetched me at least Rs 300 per kg,“ says Shivakumar, a school dropout from a village in Maddur, Ramanagaram, who prided himself as a successful silk farmer.Till a month ago, at least. Today Shivakumar, who has been in the business since 1972, is worried and uncertain.
“This price fall is unprecedented. When I started out, cocoons fetched Rs 15 per kg. I made huge profits then. Today , breeding cocoons itself costs Rs 200 per kg. If I sell at Rs 165 per kg, how will I pay my loans and survive? This will drive us sericulturists to suicide,“ he says.
Shivakumar isn't exaggerating. Suicides have in fact begun in Ramanagaram, India's Silk City that houses the largest silk cocoon market in Asia. On May 8 this year, 28-year-old Ganesh and his mother Lakshmamma killed themselves by jumping into a nearby lake. The duo had invested Rs 15,000 in breeding the silkworms and cocoons. But the produce fetched them a mere Rs 6,000 in the market. Similar stories emanate from the region. And for the past few weeks, angry sericulturists have been laying siege to the Bengaluru-Mysuru highway and halting traffic, hoping that the Union government will pay heed.
At the root of the problem is the Centre's slashing of the import duty on raw silk from 15 per cent to 10 per cent. This has caused an overnight 30 per cent crash in prices of silk cocoon, that is already seeing a glut.
At the Ramanagaram market, the government officials are worried too. The sericulture department is staring at a huge influx of silk cocoons into the market and further crash in prices. E T Venkatesh, deputy director at the market, says, “We are seeing a surge of silk cocoons daily and are running out of space,“ he says.
Karnataka produces half of India's raw silk and has over 10 lakh people associated with the sericulture sector. The state government is understandably concerned, with chief minister Siddaramaiah sending letters to the Union textiles ministry requesting to reverse the import duty cut and sending delegations to New Delhi.
Heavy-duty politics
A run Jaitley says the move to cut import duty is in tune with the government's Make in India policy. While the finance minister may be alluding to the weaver community and textile industry, especially in PM Narendra Modi's constituency of Varanasi, silk farmers in Karnataka loudly wonder why the policy doesn't protect their interests as well. C Puttuswamy, secretary for the Karnataka State Farmers Association, says the Varanasi weavers' lobby has much to do with the cutting of import duties on Chinese silk. In 2011 too, when the import duty was cut by a whopping 25%, farmers in Karnataka had blamed the north Indian lobby of silk traders and weavers.
Enter the dragon
Chinese silk yarn is preferred by powerlooms as the yarn is smoother and easier to handle than thicker and fragile Indian silk. Till a decade ago, Chinese silk had 40% of the share in the market when much of the weaving was on handlooms. The advent of powerlooms has reversed the dominance. According to Habibullah, the general secretary of Karnataka Reelers Association, merchants are ready to pay an extra Rs 900 to Rs 1,000 for better quality Chinese silk.With bulk buyers like Tamil Nadu too switching to powerlooms, Karnataka is staring at lower demand.