The Southern India Mills’ Association (SIMA) has urged the Centre not to register any further contracts for cotton exports and ban exports for the current season (2009-10).
“The total production would slip to 26 million bales (one bale is 165 kg) this year, as against 29 million bales produced during the last season due to drought and floods in all the major cotton growing states.
Of the total production during the 2009-10 season, only around 16 million bales are expected to be above average quality. If this cotton is exported as against the domestic requirement of 24 million bales, the Indian textile industry would lose its competitive edge in the global market,” RK Agarwal, member of SIMA and chairman of AP Spinning Mills Association, told mediapersons here on Tuesday.
Inferior quality cotton of 10 million bales during the current season would increase the cost of production by almost 10 per cent.
This is when the industry is already spending over 10 per cent of its cost on transportation for bringing the cotton from upcountry centres to consuming destinations as against 5 to 6 per cent spent by competing countries such as China and Pakistan, he added.
Agarwal said multinational cotton traders, who had already established themselves in various cotton growing under-developed countries in Africa, have intruded the Indian markets taking advantage of removal of cotton textiles from the Essential Commodities Act from December 24, 2006.
“As a result, the Indian textile mills are paying 30-40 per cent higher price for the Indian cotton,” he added.
A SIMA delegation would meet Union textiles minister Dayanidhi Maran in New Delhi on November 11 to make a representation on these issues. “We are asking the central government to announce a proactive cotton policy and create a level-playing field so as to enable the Indian textile industry to have a healthy competition with its competing countries such as China, Pakistan, Thailand, Sri Lanka, Bangladesh and Indonesia,” Agarwal said.