The Union Government has brought cotton yarn under the ‘free list' for exports.
According to a notification of the Union Ministry of Commerce and Industry, dated March 31, 2011, export contracts of cotton yarn (other than sewing thread) will have to be registered with the Director General of Foreign Trade prior to shipment. Customs clearance
The customs will give clearance for export of cotton yarn consignments after verifying the registered contracts. So far, cotton yarn exports were restricted with export allowed against licence.
D.K. Nair, secretary general of Confederation of Indian Textile Industry (CITI), told The Hindu that this would help export of some of the piled up yarn stocks with textile mills. The cotton yarn advisory board had recommended to the Union Textile Ministry that 845 million kg of yarn could be exported during 2011-12.
Yarn demand had declined in the domestic market during the last few weeks and now the international demand was also coming down.
Though cotton prices were increasing, yarn prices had not shot up as there were not many buyers, he said.
Our Staff Reporter from Tirupur adds: The Tirupur Exporters Association has appealed to the Union Government to restore the restrictions on the cotton yarn exports, which was removed by a notification issued by Directorate General of Foreign Trade (DGFT) on March 31.
TEA president Arumugam Sakthivel said the DGFT's decision to bring the cotton yarn exports under free category would have a direct impact on downstream sectors in apparel manufacturing chain.
“Removal of the restrictions is going to trigger cotton yarn prices especially at a time when the apparel sector is facing shortage of adequate quantity of yarn.”
The Association wanted the Union Commerce Ministry to calibrate the yarn exports month-wise with caps on different counts of yarn ranging from 1s count to 40s count yarns. This apart, the ceiling of exports should be pegged at 720 million kgs per fiscal, Mr. Sakthivel said.