Cotton export ban not to affect orders issued till Mar 4

The Commerce Ministry today issued a clarification on the cotton export ban, stating that the consignments for which export orders have been issued till March 4 would not be affected by the move.

The Directorate General of Foreign Trade (DGFT), which is under the Commerce Ministry, had issued a notification on March 5 banning cotton exports. It had also prohibited export against registration certificates already issued.

"...Consignments for which Let Export Orders (LEOs) have been issued till 2400 hours on Sunday, March 4, 2012 will be outside the purview of" notification dated March 5 regarding ban on cotton exports, DGFT said in a circular.

The ban was imposed on cotton exports apprehending shortfall in the domestic market and hoarding in warehouses.

On March 7, Prime Minister Manmohan Singh asked a group of ministers to "urgently" review on March 9 the decision to ban cotton exports, which Agriculture Minister Sharad Pawar said was taken without his approval.

The meeting of GoM, headed by Finance Minister Pranab Mukherjee, is scheduled to meet later today.

Ruling Congress party's Maharashtra and Gujarat units opposed the move when they met the Prime Minister on March 7.

Gujarat Chief Minister Narendra Modi had written to the Prime Minister seeking revocation of ban.

On Monday, the Textile Ministry had said the ban was imposed after taking into account "the trend of domestic consumption and depletion of domestic availability".

Explaining the reasons behind export ban, the ministry had said that the country has already shipped 10 lakh bales more than the exportable surplus, reducing the domestic availability.

"Almost 94 lakh bales (170 kg each) have already shipped out, against an estimated export surplus of 84 lakh bales," the ministry had said, fearing that the exports could have reached 100 lakh bales by mid-March with registration of export contracts touching 120 lakh bales so far.