Demonetization woes hit India's knitwear centre

India's thriving knitwear industry has made robust contributions to the country's economy and employment.

With units across Ludhiana in Punjab, Delhi, Bengaluru, Mumbai, and Tirupur in Tamil Nadu, the knitwear market accounts for about 45 percent of India's apparel exports.

Export figures for the domestic knitwear industry had jumped from $1,786.88 million in 2000, to over $5,047.80 million by 2010.

Tirupur is touted to be the country's knitwear hub, churning out garments valued at over Rs.13,000 crores.

Last year, the knitwear exports from Tirupur touched Rs.21,000 crores compared to Rs.18,000 crores in 2013-14.

This translated to a growth rate of nearly 16 percent year-on-year.

Global brands like H&M, Tommy Hilfiger, Nike, M&S and Diesel import their clothing items from Tirupur.

Prime Minister Narendra Modi's demonetization move resulted in lakhs of workers in Tirupur's knitwear sector devoid of cash.

Around 5,00,000 workers were left without being paid their wages, reports said.

Most of these workers were reported to not hold a bank account and relied on cash transactions.

Political parties and their trade unions resorted to day-long strikes, hoping to make an impact.

With the onset of demonetization, India's knitwear hub, Tirupur, was hit drastically by the liquidity crunch, according to reports.

Since lakhs of workers across Tirupur's maze of garment units are paid by cash, the industry faced significant impact.

Pitched to thrive as a cash-based economy, the labour-intensive industry which had an annual business amounting to Rs.40,000 crore, is currently witnessing weak revenue growth.