There's no breather for handloom sector when GST looms large

When Hemalatha Jain began reviving Karnataka’s Patteda Anchu, a form of weave, under the name Punarjeevana, five years ago, she helped equip as many as 50 weavers in Gadag district.

However, it has been a tough journey for Jain since the central government implemented the Goods and Services Tax (GST) in 2017, for not all weavers or revivalist designers like Jain have benefited from the exemptions that the tax promises.

Under GST, anyone with less than 20 lakh turnover is exempted from its tax purview. However, those in the field say the exemption has not helped them much, as the financial experts have not accounted for the rise in input costs and the difficulty of transportation for smaller set ups. They say the smaller set ups dominate the handloom sector and the bid to organise it has created obstacles at every step.

“The input costs of yarn and dyeing has gone up almost by 10 per cent. However, I am unable to pass on the cost to my customers. They wouldn’t be able to understand the reason for the sudden rise in price,” Jain says.

Patteda Anchu, a cotton handloom sari, characterised by its plain borders, double pallus and tiny checks, traces its history to the 10th century. A 250-year-old sample inspired Jain to work on the revival of the antique weave and she began working on it with just one weaver from Gajendragarh in Gadag.

“Since we do not have a GST number, we are unable to transport our goods. I am unable to courier it as the costs are high. I absorb the costs without a hike in the price. Only in exhibitions, we are able to manage with the PAN Card number,” adds Jain.

 How taxation has changed?

In Andhra and Telangana, GST has led many weavers to consider switching to other forms of occupation, says Latha Tummuru, designer and marketing, Dastkar Andhra Marketing Association (DAMA) which concentrates on cotton weaves. She says, “The handloom sector enjoyed tax exemption till GST came along. Prior to this, yardage were not covered by value added tax and only finished or stitched form of clothing had about five per cent value added tax (VAT). However, all this has changed now. Forget concession, now even the input costs for something like yardage is being taxed.”

She adds that for the purpose of transportation, if one has to take a GST number and still pay zero, they have to undergo the rigmarole of filing GST returns periodically. “For entrepreneurs in the rural set ups, there is no nearby facility to help them out with this procedure, Everything is digital now, but how can a small-time handloom entrepreneur or weaver avail its benefits from a remote village? This is driving away master weavers from the sector,” she says.

Frying pan to fire

In the textile rich state of West Bengal, known for its Jamdanis and many varieties of silks and cottons, there are a few thousand weavers who may not have a successor to take their legacy forward.

Says a source from weaver service centre in Kolkata, “As many as 60 per cent of weavers take loan and live on credit. The sector is as such witnessing a dip in sales, even as the government has tried to help them sustain with looms and rebates among other things. Now, the imposition of GST has taken them closer to extinction. While they are already overburdened with debt, the rise in input costs compels them to hike their prices a little. Any such price rise is going to meet with resistance both from buyers and merchants. The merchants sometimes blackmail them by saying that it is going to be extremely difficult to find them a market, many a time forcing them to sell their weaves at throwaway prices. In such circumstances, there are a few lucky ones who manage to break even,” adds the source.

Also, power loom substitutes that come at a cheaper price have taken away the significance of handloom. “There are a number of revival movements that are going to be hit by GST. We have as such lost many handloom varieties over a period of time as weavers migrated to more lucrative professions,” the source adds.

Weavers’ woes

In the suburbs of Chennai, Anakaputhur is trying to keep a legacy alive. Experimenting with eco-friendly products and sarees made of herbal materials, banana fibre, etc. the Anakaputhur cluster has about 150 looms. C Sekar, a third generation weaver, says their looms continue to work as they have resolved to keep it going as long as they can. “I am a third generation weaver and I am not sure if my children are ever going to take up this vocation,” he says.

The cluster which has a large number of women is also facing the heat of GST. “If I have to weave one metre of yardage, I have to spend at least ₹20 on the raw materials. I cannot make more than five metres because I work on handloom. Adding to this, because of the 12 per cent rise in input cost and the apathy of the state government towards this cluster, we are unable to claim any reimbursement or avail schemes. GST has come as an extra burden for us,” he says.

At Thirubhuvanam near Kumbakonam, the shadow of GST still haunts weavers. The Thirubhuvanam Silk Weavers Cooperative society has over 1300 weavers creating fine pieces of sarees known for their lustre and fan-like fold.

A Mahalingam, joint director, Thirubhuvanam Silk Weavers Cooperative society, says that they have a tough time explaining the increase in costs to customers. “It is quite difficult for us, as this is a prominent weave and part of the culture in the delta regions of the state of Tamil Nadu, just like Kancheepuram silk is to the northern part of the state. Every time we have an exhibition, our customers wonder why there is a price rise, but some continue to buy even after that.”

Customers like Sreemathy Mohan wonder the logic behind the rise in price. The textile curator says she is now wary of buying handloom. She says, “Prices of everything, from Bhujodi (a weave from Gujarat) to the Khadi products, have gone up. I feel they have a buffer of five per cent on products just in case they have to file GST. There is no clarity on how the GST is passed on to customers or any explanation on the same.”