Wed, Dec 7, 2016 | updated 02:05 PM IST

Ludhiana hosiery industry badly hit by demonetization

Updated: Nov 21, 2016 09:02 IST

Ludhiana (Punjab) [India], Nov. 21 (ANI): Prime Minister Narendra Modi's decision to demonetize high value currency has badly affected Ludhiana's hosiery industry.

The knitwear industry in Ludhiana contributes about 80 percent of the total woolen/acrylic output of the economy and generates employment for over 400,000 people in the city.

Demonetisation has dealt a severe blow to small time traders and shopkeepers, whose 90 percent trade happens in cash.

"The Ludhiana hosiery industry is the mother of industry which has almost 12,000 units. The sudden ban of notes has affected our industry in a very bad manner," said Ludhiana Knitwear Club Chairman Vinod Thapar.

"More than 70 per cent of the industries have shut down. Workers have migrated back to their homes and unemployment has increased," he added.

The city has a large number of small industries - both registered and unregistered - which deal with readymade garments, textiles and winter hosiery products. They export both locally and globally.

The industry has seen a downfall in consumer footfall as thousands have been left without cash in the wake of demonetization and strict limits on withdrawals from banks.

"Demonetisation has affected businesses a lot and only five percent of work has survived so far," said a worker at a garment factory, Pushp Kamal.

"How will people purchase readymade garments? Our industry is suffering a lot. As winter season is going on, and this is the season for hosiery garments and everything has gone bust," he added.

Prime Minister Narendra Modi's drive to purge "black money" from the economy by withdrawing 500 and 1000 rupee currency notes in one stroke has wiped out 86 per cent of the money in circulation.

The move to demonetise these large bills is designed to bring billions of dollars' worth of cash in unaccounted for wealth into the mainstream economy, as well as create a dent the finances of Islamist militants who target India and are suspected of using fake 500 rupee notes to fund their criminal operations.(ANI)