TAMIL NADU

25 lakh bales of cotton to be procured from Gujarat

The Cotton Sourcing Company Limited (COSCO), a special purpose vehicle (SPV) recently constituted by textile entrepreneurs in the region to source cotton in huge volumes, have forged a linkage with Gujarat ginners and farmers following talks with them at Ahmedabad on Tuesday.

“The 53 member units of COSCO will be collectively procuring 25 lakh bales of cotton every year under a consortium approach directly from the ginners and farmers in bulk so that sizable cash discounts and trade discounts can be got with upfront payment terms,” COSCO director D. Prabhu, told The Hindu over the phone from Ahmedabad.

Objective

The SPV has been constituted with the primary objective of purchasing cotton from the production bases directly so as to get assured quantity of cotton for producing apparels throughout the year and also to avoid the conventional practice of negotiating prices through middlemen.

During the talks with ginners and spinners held in the presence of Nitinbhai Patel, the Minister for Urban Development in Gujarat, the COSCO representatives presented the conditions by which cotton would be purchased. “We will be procuring the required quantity of cotton from the lowest quoted supplier who can comply with the quality parameters set by the SPV,” Mr. Prabhu said.

To facilitate speedy payment to the suppliers, the COSCO had established a Line of Credit with State Bank of India, COSCO’s technical advisor S. Dhananjayan added.

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