Rising cotton prices have become a topic of disturbance this season as the numbers are facing speed not only in raw material prices but also scarcity in availability.
In a press release, the chairman T. Rajkumar of Confederation of Indian Textile Industry said that the average price of cotton was ₹37,000 a candy (355 kg) in September 2020 and it climbed to ₹60,000 in October 2021, when the fresh cotton season began. On December 31, the price roofed at ₹70,000. Further, only about 120 lakh bales were conquered in the market between October 1 and December 31 as against the usual arrival of 170 lakh to 200 lakh bales.
Association chairman Ravi Sam of the Southern India Mills said though the 2021-2022 cotton season started with an easeful opening stock of 75 lakh bales and an estimated crop of 360 lakh bales, the cotton prices started leveling high from the beginning. There was a pent-up demand for cotton in the post-COVID period. The U.S. sanctions on Xinjian cotton, which accounts for 10% of the world’s cotton production, is another factor.
“MCX and NCDEX, dominated by the large traders are also fuelling the market.” At present, Indian cotton prices are higher than the international prices, affecting the competitiveness of the industry. The government should immediately remove the import duty on cotton.
Raja Shanmugham, president of Tiruppur Exporters’ Association alleged, “It may be noted that the 11% total import duty existing on cotton has been the reason for the cartelization of vested players to increase the domestic cotton prices, making an abnormal profit at the cost of value-added garment sectors.”
Decision on halt for the increased GST on Textile, Goyal thanking the prime minister
Union Minister Piyush Goyal thanked the prime minister for the delay on the hike of GST from 5 percent to 12 percent for the textile industry he said on Tuesday that the government is taking an initiative towards gaining ingress to new markets and getting concessional duties on textile products through free-trade agreements.
Communicating with textiles associations, The Minister for Textiles and Commerce and Industry shared that in all the ongoing negotiations with major countries like the UK, the UAE, Canada, the European Union, and Australia, there is a special focus on getting concessional duties for textile products.
According to an official statement,
“He added that the plea of industry stakeholders was considered in present challenging times when the sector is on the path of recovery.
“He also expressed his gratitude to the textiles leaders who remain connected with the ministry with all their grievances regarding raising the GST slab in MMF (manmade fiber) segment,” the textiles ministry stated.
Referring to the production-linked incentives scheme for textiles, he said PLI will increase the global footprint of India in manmade fiber and technical textiles.
He added that the Rs 10,683-cr PLI scheme will create 7.5 lakh direct jobs.
Goyal also said approval for seven PM Mega Integrated Textile Region & Apparel (PM-MITRA) Parks will attract cutting-edge technology and investment, and generate around one lakh direct and two lakh indirect employment per park.
He added that textiles exports increased 45 percent to USD 16.7 billion in April-November 2021 with respect to the same period in April-November 2019.
