Banikinkar Pattanayak
New Delhi, Jan 10
The government is planning to mandate all ginners, textile mills and traders to submit data on stock they have every month to the textile commissioner, said official sources. “Such a move will enable the government to know the exact quantity of cotton pressed by ginners, consumption by textile mills and exports by traders. The practice will be crucial to effective and informed cotton policy,” said a senior government official.
This will also reduce scope for manipulation while firming up the so-called cotton balance sheet, he added. The rule will be in sync with the provisions of the Indian Statictics Act 2008. “There is a need for reliable data on cotton production, consumption and exports. Such a measure will improve credibility of government forecasts. So we welcome the proposed move,” said DK Nair, secretary general of the Confederation of Indian Textile Industry.
However, a senior trade executive said such a decision would lead to bureaucratic hassles. The production estimate of cotton is important as the export quota is determined on that basis. Cotton export policy had sparked debate, as the textiles and the agriculture ministries sparred over allowing more shipments to gain from a global shortage. While the agriculture ministry had pushed hard for allowing more exports, the textile ministry—the nodal ministry for cotton cotton distribution — opposed the move fearing a domestic rise in prices and its adverse impact on cash strapped textile mills.
Consequently, the government kept an export ceiling of 5.5 million bales in 2010-11 before raising it to 6.5 million bales in July 2011 and finally lifting the ban later that month until the end of 2010-11 season, as domestic prices eased. The government initially decided to free cotton exports in 2011-12 anticipating record harvest, aiding exporters who are lifting a bulk of the crop after a pick-up in the Chinese demand. A ministerial panel has decided to keep cotton export ceiling at 7 million bales in 2012-13. However, exports slumped considerably due to acutin Chinese purchases and trade executives expect the shipment to drop by 50% this year. (Source: Financial Express)