Cotton export licences for 100,000 bales issued

The government has started issuing licences for exporting cotton to Pakistan and Bangladesh, trade sources have revealed..

Initially, licenses to export around 100,000 bales had been issued to around a dozen exporters, the sources said. Cotton export will be subject to export duty at a flat rate of Rs 2,500 a tonne for all varieties.

The Directorate General of Foreign Trade (DGFT) has received export license applications for some 1.3 million bales, which were registered earlier pending shipments.

In May, the government had put cotton, cotton waste, and carded/combed cotton under restricted export items list, with every shipment requiring license from DGFT.

The norm is aimed at improving domestic cotton supply to bring down prices. After fresh registration process was suspended from April 19, exporters were asked to get previous registrations re-validated by the textile commissioner.

If the government issues export licenses for all pending orders, India’s exports for 2009-10 (October-September) season will rise to over eight million bales from 3.5 million bales the previous season, the sources said.

The Cotton Advisory Board had estimated 2009-10 exports at eight million bales, before curbs like export duty, suspension of export registration, and mandatory export license regime were introduced.