The informal Group of Ministers (GoM) led by Pranab Mukherjee on Wednesday decided to allow export of additional 10 lakh bales of cotton during the current season in the wake of a sharp fall in prices in the domestic market. “We had calculated earlier an exportable surplus of 55 lakh bales which was permitted. The GoM has decided to allow another 10 lakh bales. The total exports will now be 65 lakh bales in the current season,” Commerce and Industry Minister Anand Sharma told reporters after the meeting chaired by Mr. Mukherjee.

The country had already exported 52.5 lakh bales and the remaining quantity would be allowed to be exported, he added. Cotton season runs from October to September.

Agriculture Minister Sharad Pawar, who is also part of the GoM, said: “We will review the situation in a month or month-and-a-half after we get the report of the sowing area. Our assessment is that in the coming season, the area under cotton will be more, so for the time being, we have decided to [allow additional] export [of] 10 lakh bales,” Mr. Pawar said.

Mr. Sharma said the GoM took stock of the ground realities, the need of the industry and also the requirement of cotton for domestic consumption, till the next crop arrives in October. The government had imposed a quantitative restriction on cotton exports in October when prices of the natural fibre had shot up.The restrictions on cotton exports came in for criticism from farmers' organisations and the Gujarat Government. The Agriculture Ministry was also in favour of relaxing exports curbs and allowing additional exports of 15 lakh bales in the 2010-11 season. On the other hand, the Textiles Ministry was against the proposal citing the move would hurt the interest of the mills.

According to the Agriculture Ministry data, the country is estimated to have produced a record 339 lakh bales in 2010-11 crop year against 242 lakh bales in the previous year. However, the Cotton Advisory Board has lowered the cotton output to 312 lakh bales in April from 329 lakh bales, mainly due to unseasonal rains in Tamil Nadu, Andhra Pradesh and Maharashtra last December.

More In: Economy | Business | National | News