Khadi faces dark days: Handloom’s GST blow
India is a land of rich textiles. Each state of India has its own handwoven, handembroidered, traditional handloom textiles and sarees that have won the admiration of millions across the globe. In postIndependent India, successive governments have taken special measures to protect and promote India’s rich handloom textile industry through legislative and institutional mechanisms, tax incentives and other financial measures; by setting up cooperatives and linkages for marketing the products, by reserving products within handloom categories to eliminate competition with mass-produced textiles and through various other methods. However, in the past one year, the double jolt of demonetisation and a hastilyimplemented and complicated Goods and Services Tax that did not give a tax exemption to handloom, at least in the first round, has dealt a severe blow to the handloom industry.
According to the data from the ministry of textiles, there are 43.31 lakh weavers in India, out of which 77 per cent are women. Out of these 43.31 lakhs, as many as 36.33 lakh are in rural areas. Large sections of the weaver community belong to the minorities, and other socially and economically marginalised sections of society. Many of them live below the poverty line. By a rough estimate, 61 per cent of weavers work independently, 34 per cent work under master weavers, and only five per cent work through cooperatives and clusters. The handloom industry is totally decentralised, and is spread across India. It operates within the informal sector, and creates around 14 per cent of total textile production in India.
The Indian textile industry is one of the world’s oldest. There is evidence of cotton production in the Indus Valley Civilisation. Indian cotton and silk were prized items for export in ancient India to other ancient civilisations. Super-fine cotton fabric called muslin, known in ancient Rome as ventus textilis (the woven wind), was a highly-coveted item. It’s said that it was so fine that Roman emperor Augustus banned its use as a dress material by the women of his court through an imperial decree stating it’s bad for the morals of his people. Ibn Batuta, the 14th century traveller, noted that among the presents sent by Delhi’s Sultan Muhammad bin Tughlaq to the Yuan emperor in China were 100 pieces each of five varieties of cloth, each category named differently.
When the East India Company ventured into India, one of its main items of export was Indian textiles. This changed only after the Industrial Revolution in England. Along with new technologies, England adopted a protectionist policy towards its own nascent textile industry by banning the import and sale of finished pure cotton products from India. In India, the colonial administration not only discouraged the indigenous textile industry, but flooded the Indian market with cheap mill-produced Lancashire textiles. At one stroke, a millenniaold tradition was reversed. From being the world’s largest textile exporter, India began to import British textiles. During the freedom movement, Mahatma Gandhi began the practice of spinning and weaving homegrown textiles — khadi. The symbolism of khadi in India’s Independence movement is immense. Khadi symbolised India’s pride, entrepreneurship, a move towards self-sufficiency, and a spirit of resistance to the mighty colonial power. Khadi remains one of the most potent symbols of India’s independence from “political slavery, economic bondage and cultural stagnation”. It’s an intrinsically embedded imagery of the freedom struggle with Mahatma Gandhi. It’s shameful to see the Mahatma’s image replaced by the current Prime Minister’s photograph in khadi calendars, with a minister of the ruling party from a state saying that Mr Modi is a bigger brand than Mahatma Gandhi. For the first time in Independent India, khadi has been taxed under GST. Though the khadi yarn, Gandhi cap and the national flag remain exempt, other items made of khadi, including apparels, are being taxed.
The handloom textile industry operates within a framework of cash and credit flow. The weavers are given credit by middlemen and/or traders for the purchase of raw materials like yarn, threads or zari. With demonetisation, the cash disappeared and credit stopped. Demonetisation hit all small and mediumscale industries in the informal sector, but the handloom sector suffered an even bigger blow. It already had to compete with large-scale mass production of textiles. With the withdrawal of cash from the market, not just production suffered due to lack of availability of credit and cash in hand to purchase raw materials, but also demand dipped due to the reduced purchasing power, leading to a vicious circle of low-demand, low-production and stagnation in the market.
The government’s refusal to grant a tax exemption to handlooms while introducing GST has led to even more miseries for weavers. Thanks to the lack of technical knowhow and the absence of an efficient machinery to help implement GST, the utter confusion in the informal sector, including the handloom sector, continues. The weavers are not given credit as they can’t raise invoices due to the lack of digital as well as financial literacy. The tax on sarees and apparels above `1,000 has made competition far tougher for the handloom sector. According to a media report, in Varanasi, the Prime Minister’s constituency, which is one of the earliest textile centres in India, traditional weavers have been rendered jobless and are being forced to look for other jobs. Over 70 weavers are said to have committed suicide in Varanasi due to the vicious cycle of debt and poverty.
Handloom is not merely an economic activity. It’s an art that its practitioners dedicate their lives to learn. The master weavers produce masterpieces that not only exemplify an individual’s superb skills but contain centuriesold traditions in a single piece of cloth. In many weaving communities, skills are imparted by home training and continue through generations. It’s the State’s responsibility to create a conducive environment for such craft to survive and thrive. Mr Modi’s government talks about skilling India, but seems to be doing its best to destroy one of the most ancient and precious talent-pool of skills the country has.
For the first time in India, khadi has been taxed under GST. Though the khadi yarn, Gandhi cap and the national flag remain exempt, other items made of khadi, including apparels, are being taxed.