The Central Government should have allowed only ‘calibrated export' of cotton instead of its decision to allow free and unrestricted exports back from October 1 onwards, according to Cotton Advisory Board (CAB) member Raja Shanmugam.

“This announcement, made a month ahead of the scheduled date of October 1, has resulted in raw cotton prices shooting up tremendously owing to commencement of futures trading, which is bad for the domestic apparel manufacturing industry in the coming months,” he told The Hindu here. The prices of Shanker-6, most preferred variety of cotton in clusters like Tirupur, had shot from Rs.29,500 per candy prior to the declaration of releasing export restrictions on August 17, to touch Rs.33,500 per candy now.

Mr. Shanmugam, a Tirupur-based textile entrepreneur, is the member representing the knitwear sector in the CAB, which was constituted as a representative body of government, growers, industry and trade that advices the government on matters pertaining to production, consumption and marketing of cotton.

According to him, scale of calibration for cotton exports should be decided after properly studying the domestic needs for the ensuing ‘cotton season.' “During the coming cotton season (from October 2010 to September 2011), it is expected to produce 325 lakh bales from 106 lakh hectares under cotton cultivation in the country,” he said.

Only that quantity from the output which was surplus to the needs of Indian manufacturers should be exported, he opined.

Mr. Shanmugam feels that it was an unwise move to allow raw cotton exports right at the commencement of cotton season since very high quality of cotton was harvested normally during the first three months of the season.

“Allowing such good variety of produces to flow out of the country is only going to help our competitors like China, Bangladesh and Pakistan to flourish in the global apparel export trade at the expense of us,” he said.

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