Punjab slashes fees on raw cotton

Punjab Chief Minister Parkash Singh Badal today decided to slash the market fee and Rural Development Fee (RDF) on cotton varieties Narma and Kapas from 2 per cent to 1 per cent with immediate effect for the cotton procurement season 2010-11.

Disclosing this here today, a Punjab government spokesperson said that this decision had been taken to safeguard the interests of both the cotton growers and cotton ginning industry.

Besides, this decision would also provide a level playing field to the cotton ginners in the state who were facing unhealthy competition from the cotton industry in other states like Rajasthan, where the market fee on cotton was 0.80 per cent and 1 per cent each in Maharashtra and Gujarat.

It may be recalled that the state government had already abolished the Punjab Infrastructure Development Cess of 2 per cent levied on the ginning and spinning (composite) units on raw cotton recently during a meeting with the Chief Minister held on August 9, 2010.

Expressing gratitude to the Chief Minister, the members of the Association assured Badal that this decision would result in quantum jump in the revenue from VAT and market fee during the current procurement season, which was expected to touch nearly '125 crore on VAT and '80 crore on market fee.