Facing pressures from growers, traders and China, the nation’s largest customer, India as of 12th March scrapped a one-week-old ban on exports of cotton. “Keeping in view the interests of the farmers, industry, trade, a balanced view has been considered by the Group of Ministers to roll back the ban,” said Commerce & Industries Minister Anand Sharma, who is also handling the Textile Ministry.
Earlier, India had banned cotton exports to conserve supplies for local mills as per the Directorate General of Foreign Trade (DGFT) officials. Over 80 per cent of exports so far have headed to China. The industry had reacted very positively to the ban. While S. Dinakaran, Chairman, SIMA had described the Government decision as timely ensuring adequate availability of cotton for the domestic sector till the end of the season, A. Sakthivel, Chairman, AEPC argued, “While 1 kg of raw cotton provides a yield of Rs.100, same cotton as trousers provides a yield of Rs. 500. The employment level at raw cotton level is 0.5 workers per kg; however, as garments 60 lakhs workers get jobs. Therefore, finished goods production offers maximum potential for employment.”
Rikhab C. Jain, Chairman TT Group went a step further questioning why despite being the best cotton in the world Indian exporters are selling cotton at least 10 cents per pound cheaper. He suggested that whenever cotton exports take place in future, it should always carry export duty of Rs.10,000/- per metric tonne minimum to allow level playing field for Chinese importers of Indian cotton and Indian domestic cotton users.”
However, yet again the interest of farmers has taken precedent over the interest of the industry to the disappointment of the textile chain. There is a need for a strong integrated policy otherwise such arbitrary action will continue…
