Surat. Constant rise in number of firms getting vanished after purchasing stock from traders and weavers is badly affecting textile sector, backbone of Surat’s economy. In past one month, 20 textile firms operating at various markets in the city have wrapped business. This is directly affecting economic cycle of weavers, traders and brokers.
Surat has 40000 textile shops, doing business of Rs35000 crore annually. Sector that runs on mutual understanding and trust is passing from bad phase due to such firms. Despite all attempts by FOSTTA (Federation of Surat Textile Traders Association), such firms continue to exist in textile markets.
“Such incidents affect entire economic cycle of textile sector. Trader, weavers and brokers face financial crunch, while have to suffer financial losses during settlement. It also brings down level of trust among traders,” said Devkishan Mangdhani, a textile trader in Surat.
He added that to contain incidents of cheating, FOSTTA came-out with an idea of preparing a data base of all textile traders. Registration forms were even distributed at all markets. However, effort failed to give expected results.
Manoj Agrawal, president of FOSTTA (Federation of Surat Textile Traders Association) said that along a special campaign will be initiated with help of Surat Police, to create awareness among traders. Team consisting FOSTTA members and policemen will hold meeting with administrative members of all textile markets.
“Traders are repeatedly asked to maintain caution, while doing business with new trader or broker. Situation can be prevented, if traders cross-verify details of particular trader or broker before doing business,” he added.
Surat police commissioner Rakesh Asthaana said that all necessary action is taken by police, once complaint is registered. The only solution to prevent such incidents is to register complaint in all cases. It will expose such firms and their owners before people.
Surat police receive 10 applications in a month
Salabatpura police station of Surat police receives maximum applications for cheating in a month. This is because all textile markets fall under its jurisdiction. According to officials, ten applications related to cheating are received every month. Complainant and accused go for settlement in majority of applications and only 10% application result into police case. FOSTTA pressurizes defaulters and traders to go for settlement, said police.
145 textile markets in the city
40000 textile shops
Rs35000 crore annual turnover of textile sector in Surat
Rs200-300 crore loss sector suffers annually due to vanishing firms
Trader has to settle in 25-35% amount against actual amount to be recovered from such firm
Modus Operandi of vanishing firms
Suddenly close shop and trader switches off his cell phone
Trader places a board that shop will be closed for few days due to unavoidable circumstances (death, disease and other reasons)
Trader defers from opening shop after vacation period
Defers payment even after 4 months. Normally, trader is given four months credit for clearing dues by weaver and traders.
FOGWA asks weavers to do business with bills
Federation of Gujarat Weavers Association has urged all weavers in Surat to maintain bills for transactions done with textile traders. Ashok Jirawala, president of FOGWA said that weavers are asked to cross-verify details of traders, along with family back-ground, before striking any deal with them. FOGWA has also decided to take help from FOSTTA to identify firms having tainted past.