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RBI demonetization of Rupees 500 and 1000 currency effect on textile industry in India

RBI demonetization of Rupees 500 and 1000 currency effect on textile industry in India

RBI demonetization of Rupees 500 and 1000 currency effect on textile industry in India

PM Narendra modi announced demonetization of Rs500 and 1000 currency notes with effect from midnight of 8th November 2016 so after this day the legal tender of Rs500 and Rs1000 currency of RBI will not valid in India and whole world.  This decision of demonetization for Indian currency Rupees 500 and 1000 lightly effect in textile industry in India like purchase of new yarns and fabric from cash payment in India. Textile industry is majority depends on labor and job work of textile like embroidery job work, fabric printing and other textile labor work.Demonetization will affect cotton and cloth industry because new cotton will not purchase in India for next few days and price of cotton will decrease suddenly for next few days.

Central government moves on withdrawal currency of Rupees 500 and Rs1000 from market it will create some negative impact on cotton yarn market and textile machinery manufacturers. Textile analytical says this effect is for short term period. Textile business in India is mainly depends on cotton industry and textile job work in India. This will also affect readymade garment business in India. RBI will change old currency of Rs500 and Rs1000 notes in own bank accounts.

China and Bangladesh is major competitor of India in textile sector so for next few days all export business of textile in India will lightly slow due to unavailability of currency in India. Yarn exporters and cotton yarn manufacturers will not purchase cotton from Indian markets. The production of cotton from farmers will stock from November 9, 2016. It will have deflationary impact in small consumer business apparel garment cloth, ethnic wear products, textile job work, home textile furnishing product and on fiber and cotton raw material prices variation in economy market in India. As a consumer retailer shop in urban and small town, if you depend on cash counter by customer it could be difficult over the next one week to month.