Price going up because of scarcity: SIHMA

The South India Hosiery Manufacturers Association (SIHMA) has asked the Union Government to withhold the export of cotton and release it for internal consumption so as to control the fluctuations in the prices of cotton and yarn. In a memorandum to Union Agriculture Minister Sharad Pawar, association president A. C. Eswaran said already 80 lakh bales of cotton had been exported during the current cotton year (October 1, 2012, to September 31, 2013).

“Looking at the current stock across the country, only 90 lakh bales are available for the rest of the season. Of this, the Cotton Corporation of India is holding 25 lakh bales, another 25 lakh bales is in the possession of cotton exporters, and the lion’s share of the remaining 40 lakh bales is with private cotton traders,” he said.

The hosiery manufacturers were of the view that unless steps were taken to stop the exports at this juncture and route whatever available stocks for consumption within the country, there could be further escalation in the prices of cotton and yarn.

“On April 1, the prices of various counts of yarn have gone by Rs. 15 a kg mainly because of the scarcity. Hence, any further exports can shoot up the prices immediately,” Mr. Eswaran said.

Duty drawbacks

R. Girish, an exporter and member of Tirupur Exporters and Manufacturing Association, said if the Union Government could not impose a ban on exports immediately, at least the duty drawback on cotton exports should be reversed so that exports would automatically become unattractive.