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India's ban on cotton yarn exports thumps Nepali textile sector
Dec '10
Textile sector in Nepal, particularly the hosieries and small apparel manufacturing units, which depended on cotton yarn imports from India, has been adversely influenced by the decision taken by the Indian Government to impose prohibition on cotton yarn exports and has been forced to shut down the shutters due to lack of raw materials.

The textile sector in Nepal also imports cotton yarn from India in addition to its demand for raw cotton. Enforcement of prohibition on cotton yarn exports by India has caused a severe scarcity of the raw material in Nepal.

Due to the tremendous pressure from the domestic hosieries that have been confronting cotton yarn scarcity since quite some time, the Government of India has enforced the ban on cotton yarn exports from last October.

Every year Nepal imports 5,000 tons of cotton yarn, mainly from India, which is the leading producer of cotton in the world. Prices of cotton yarns vary from Rs 200 to Rs 500 a kg depending upon their quality.

Majority of the small RMG units, Dhaka industries as well as hosieries that uses cotton thread as raw material have been compelled to shut down their operations owing to the ban enforced by India. Small apparel manufacturing units that depend on cotton are functioning in Lalitpur, Thamel, Lubhu and several other parts of the country.

The polyester thread that is needed by the industries in the country is manufactured by the local industries only. Polyester accounts for nearly 90 percent of the overall domestic production of thread that is required by the clothing sector in the country.

Nepal entirely depends on cotton imports from India to fulfill its requirement for the rest of the 10 percent of its overall thread requirement. Imposition of ban on cotton yarn exports has not only influenced the local supply of cotton textile products but their exports also.

Earlier the situation was different. When some of the leading textile units such as Hetauda Textile and Butwal Dhago Industry were operational, the clothing units used to meet their raw material requirements from local outputs only.

Fibre2fashion News Desk - India

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