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GEA requests Govt to suspend cotton yarn exports
Nov '10
Garments Exporters Association has appealed to the Government to immediately suspend export of cotton and cotton yarn, because of the recent extraordinary rise in cotton prices and consequent steep hike in prices of the yarn. Besides price fluctuation, fabric availability has become a serious issue as weaving units are not making any delivery commitments.

In a letter to Shri Dayanidhi Maran, Union Textile Minister and Shri Anand Sharma, Union Minister of Commerce and Industry, Mr Rakesh Vaid, President, Garments Exporters Association has drawn their attention to the declining trend in garment exports. Mr Vaid pointed out that the latest foreign trade data reveals that garments exports have declined by 6 per cent whereas overall exports increased by 21 per cent during the period April-September, 2010.

Although, the Government had earlier taken some positive and appreciable steps to moderate the prices of cotton yarn, the prices of cotton yarn in the domestic market have not yet come down. It seems steps taken so far have not yielded the desired results as yarn and fabric prices are still going higher and higher resulting in financial hardships to exporting community.

While protecting the interest of farmers with a remunerated price for cotton, the Government must ensure that middle-men and speculators do not exploit the situation created by short supply of cotton in the world market. The recent export of raw cotton and cotton yarn to our neighbouring competing countries like, China, Bangladesh and Pakistan have hurt our apparel exports.

Mr Vaid further pointed out that cotton yarn prices are currently at an all time record high. This steep hike in prices has adversely affected the competitive strength and performance of Indian Apparel Industry. Mr Vaid has, therefore, requested the Government to immediately suspend the exports of cotton yarn so as to ensure un-interrupted supply of cotton yarn at reasonable prices to garment exports.

Mr Vaid also stressed the need for value added export of garments rather than raw cotton, yarn or fabric. This is because the value addition is over 6 times, if same amount of cotton yarn that is being exported is used by garment exporting units, added Mr Vaid.

The Government must take immediate steps to resolve a serious crises being faced by the Textile Industry because of non-availability of cotton, yarn and fabric even at higher prices.

Garments Exporters Association

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