The Ministry of Textiles has, through a notification dated June 15, slashed hank yarn obligation for textile mills to 20 % from 30 % .

Hank yarn obligation is the mandated quantity of yarn for the domestic market that should be packed by textile spinning mills in hank form to be supplied to the handloom sector.

The last revision of the obligation was in 2019 when it was reduced from 40 % to 30 %.

From July - September quarter of 2026, the mills have to pack only 20 % of the yarn produced for the domestic market in the hank form and file quarterly returns to the office of the Textile Commissioner. If the obligation fulfilled is less than 15 %, the mills can carry forward the obligation.

“This is one of the long-pending demands of the textile mills as the consumption of yarn by the handloom sector has reduced over the years,” according to an industry official.

The handloom sector currently faces issues such as labour shortage and stringent pollution control norms. If the yarn is dyed in hank form, water requirement for this process is high and it leads to pollution issues too. If the handweaving sector moves over to modern processing techniques, the yarn need not be in hank form.

Further, when there is a demand for handwoven products it will trigger the market for yarn.