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Anna Silk Exchange, Kancheepuram

Development of Silk Reeling Industry  was sluggish in Tamilnadu,  since raw silk production and trading  was mainly concentrated in and around  Bangalore.  Further analysis revealed that difficulty in marketing of raw silk was the main reason for this slow growth of silk reeling sector in Tamilnadu.  The major silk consuming centres like Arani, Kancheepuram, Kumbakonam and Salem were drawing their silk through traditional  customised  trading channels  from Bangalore.  In order to facilitate marketing of raw silk produced within the State, Anna Silk Exchange was set up in Kancheepuram and it has been functioning there since 9.1.1991.  The reelers of Tamilnadu bring the silk produced by them to the Anna Silk Exchange for sale. All the silk lots brought this way are first tested for quality at the Silk Conditioning and Testing House, Kancheepuram (under the control of Central Silk Board). Then the floor price of each silk lot is fixed based on the average silk price in Karnataka and the quality of the particular lot. Then the silk lots are put up for auction. TANSILK, Silk Weavers Co-operative Societies, twisters and other consumers participate in the auction. The exchange ensures spot payment to the reelers.


The operations of the Anna Silk Exchange has stabilised the silk reeling industry and has encouraged more investment in the reeling industry by  private entrepreneurs. This can be seen by the increasing transactions in the cocoon markets.  It has also eliminated middlemen such as financiers and commission agents and has been able to establish a direct link between the producers and the consumers of silk in Tamilnadu.


A market fee of 0.75 %  of the value of silk transacted is collected from both sellers and buyers transacting in the exchange. This is remitted to the Sericulture Development and Price Stabilisation Fund and is subsequently utilised for provision of amenities in marketing centers and for the development of Sericulture Industry.  Currently Anna Silk Exchange transacts about 200 Metric Tons of raw silk every year.  Till date only the organised sector of silk weaving industry has been participating in the exchange.  The private silk weavers and the master weavers have not transacted in the exchange in a substantial manner so far. This is because they  mostly get the silk yarn supplied on credit while the exchange demands spot payment. However with increasing awareness about quality it is expected that the private sector will also start participating in the auctions conducted by the exchange.