Dyeing units in Rajasthan which had to shut down following charges of effluent release have been allowed to reopen. However, they have to comply with certain norms. These include installation of a primary treatment plant, payment of a security deposit ranging from Rs 2 to Rs 5 lakh per unit, connecting all the dyeing units to a common effluent treatment plant, fixing of meters in the bore well and a flow meter for the water pipeline, and disposal of sledge in specified areas.

The decision to restart is expected to lead to an improvement in the yarn market. There is a sudden spurt in demand for yarn and prices have also started looking up, improving by Rs 4 to Rs 6 a kg. This will help improve capacity utilisation levels in the mill sector.

Export demand for cotton yarn has also picked up particularly from countries like China and Vietnam since July. Total cotton yarn exports between January and August this year increased by 11.89 per cent when compared to the same period of the earlier year.

The mood is upbeat. Prospects for the textile industry look good. One positive development is that the two per cent export benefit under Merchandise Export from India Scheme has been extended.