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Indian govt dispenses export registration for cotton, yarn
09
Dec '14
The Government of India has dispensed with the registration requirement for export of cotton (Tariff codes 5201 & 5203) and cotton yarn (Tariff codes 5205, 5206 & 5207), with immediate effect.
 
The Directorate General of Foreign Trade (DGFT), Department of Commerce, Ministry of Commerce and Industry, has issued two separate notifications on amendment in export policy of cotton and cotton yarn.
 
The amendment in export policy of cotton says the export of cotton neither carded nor combed (Tariff code 5201) and cotton, carded or combed (Tariff code 5203) is made free without any restrictions.
 
Similarly, the notification on amendment in export policy of cotton yarn removes all restrictions on export of cotton yarn under three tariff codes—5205 (cotton yarn other than sewing thread, containing 85 per cent or more by weight or cotton not put up for retail sale; 5206 (cotton yarn other than sewing thread, containing less than 85 per cent by weight or cotton not put up for retail sale); and 5207 (cotton yarn other than sewing thread, put up for retail sale).
 
Until these notifications were issued, it was mandatory for exporters to register with the DGFT in advance mentioning their targeted export volume for the year.
 
During the current cotton season that began on October 1, 2014, India is likely to produce a record 40 million bales of 170 kg each, and is most likely to overtake China as the world’s largest cotton producer.
 
On the other hand, India’s cotton yarn exports are forecast to drop by as much as 24 per cent to about 9 million bales this season mainly due to weak Chinese demand, according to the Cotton Advisory Board (CAB).
 
The latest regulation is expected to help stabilise cotton prices in India’s domestic market, where the prices in some states are currently ruling below the minimum support price (MSP) announced by the Government.
 
Meanwhile, T Rajkumar, chairman, The Southern India Mills’ Association, has thanked the Government for bringing cotton yarn exports under free list. He said the removal of mandatory export registration is a first step in the right direction towards achieving the mission of ‘Make in India’ set by Prime Minister Narendra Modi and also identifying the manufacturing sector, particularly the textile industry as the key area for strengthening the Indian economy. (RKS)
 

Fibre2fashion News Desk - India


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