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Cotton export to stand at 5.5 million bales
Dec '10
The deadline to fulfill the full export quota limit of 5.5 million bales (170 kg each) passed by with only 50% of this limit shipped as of December 15, 2010.

The Government's earlier decision to allow 55 lakh bales (5.5 million bales of 170 kg each) will stand although the regulations and modalities with regard to the export of the remaining un-exported quantity will be determined once the actual exported quantity level is known and verified. Time to export is not decided yet. Government of India moves the authority to oversee the export registration to Ministry of Commerce & Industry.

In a significant move, Government of India shifted the contract registration authority from the Ministry of Textiles, Office of the Textile Commissioner to the Ministry of Commerce and Industry's Directorate General of Foreign Trade (DGFT). In my view, this shift signals the importance of trade and commerce associated with the export of cotton from India.

As of today, there are three different production reports for the 2010/11 season. Cotton Advisory Board's latest estimate as of August stipulates the production to be 32.5 million bales. The Cotton Association of India in its November report has estimated the production to be 35.7 million bales. However, the spinning industry trade body, The Southern India Mills' Association has refuted these reports and is estimating the production to be about 29 million bales. An Indian bale weighs 170 kg each.

I have opined all along that in order to satisfy all constituencies in India such as agriculture, textiles and commerce, the government will endeavor its best to stick to the already decided exportable limit of 5.5 million bales. With the December 15th development of un-fulfillment of total export limit, procedures and modalities to export the remaining quantity will be established once verifiable data is obtained. This will take a few weeks and an announcement can be expected in the New Year by January 2011 end.

The maximum export limit for the 2010/11 season stands at 5.5 million bales and when the exports will be allowed for the un-exported quantity is yet to be determined. The regulation authority for the export registration and oversight has now been shifted to the Ministry of Commerce and Industry. Roughly 50% of the maximum allowed quantity of 5.5 million bales has not been shipped as of December 15, 2010.

Seshadri Ramkumar, Texas Tech University

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