Mills association submits a memorandum to the government

Textile mills in the State have sought financial support from the Union Government to buy cotton for long term when the season commences in October every year.

The Southern India Mills’ Association has submitted a proposal to the Government for interest subvention scheme for cotton purchase.

Its chairman T. Rajkumar told presspersons here on Wednesday that the association has sought special working capital (for nine months as against three months that is available now) at 7 per cent interest and reduction of margin money to 5 per cent from 25 per cent for cotton purchase.

Cotton prices have shot up during the last few weeks as the season is coming to an end and 95 per cent of the mills do not have cotton stocks with them.

Higher cost of the raw material have resulted in yarn prices going up. If the mills had working capital for cotton purchase for nine months, they will be able to compete with multinational cotton traders and buy adequate cotton.

The association will also work with government agencies, universities and other cotton organisations to create a platform and draw an action plan to achieve annual cotton production of 700 lakh bales by 2020.

(The production now is less than 350 lakh bales).

The Government should permit field trials for genetically modified (GM) cotton varieties that will take care of problems such as sucking pest and weeding.


The mills fear that area under cotton (the main raw material for the mills) will decline in the country if the Government does not takes steps to increase yield, which has reduced to 480 kg a hectare from 540 kg.

Cost of labour, fertilizers, etc has also increased, he said. Hence, the focus should be on reducing costs and increasing yield to expand the area under cotton.

Further, the SIMA Cotton Development and Research Association will conduct 300 front line demonstrations this year on production technologies.

The Directorate of Cotton Development has sanctioned Rs. 6 lakh for this purpose.

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