CHENNAI: The Apparel Export Promotion Council (AEPC) has requested the government’s immediate intervention in order to impose quantitative restrictions and an export duty on cotton yarn exported from India. The council expressed its concerns to the union textile minister in a letter, citing the increase in cotton yarn prices over the last four months, which has impacted the entire value chain in the industry.
“We respectfully request your prompt involvement to increase yarn supply to domestic manufacturers. “We propose that exports of cotton yarn, specifically cotton yarn of 26 counts and above, be subjected to quantitative restrictions,” said A Sakthivel, chairman of the AEPC. He went on to claim that yarn prices are growing at a much faster pace than cotton prices.
Cotton prices have risen sharply, causing handloom and powerloom weavers to lose out on export orders.
The chairman went on to say that if yarn is exported at the expense of domestic and export-oriented production, the entire country loses. “It’s equivalent to outsourcing workers at a time when the whole country is attempting to re-employ people,” he said.
He also suggested that cotton yarn exports be subject to an export duty. “As a consequence, domestic yarn prices will plunge, resulting in increased value addition and jobs in the region. This will also aid in the growth of garment exports. And it would only result in average profits for yarn spinners, not the supernormal profits that are currently being made due to profiteering,” he said.
Meanwhile, the Cotton Council of India has urged cotton mill owners to reduce yarn prices by Rs 20 per kg to support the sector’s growth, citing rising rates as a factor affecting cost competitiveness in the wake of the Cotton Corporation of India’s price reductions.
