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Demand for lower cotton prices is not justified -A Narayanamoorthy

-The Hindu Business Line

The textile industry’s vociferous demands will hit cotton farmers, who are facing the brunt of rising costs

The recent rise in the price of cotton yarn seems to have hit the textile manufacturers hard, so, a large section of participants involved in value chain products of cotton has called on the government to take measures to arrest the price rise.

While demanding higher taxes on cotton exports, they have demanded scrapping of the 11 per cent import duty and halt of cotton from the futures trade to stabilise the price.

But are these demands justified ? Will lowering the price of yarn not affect the 58 lakh farmers who have been cultivating cotton on about 134 lakh hectares with various hardships? Do the farmers reap any profit from cotton cultivation?

Cotton cultivation

Cotton has been cultivated as an important commercial crop in India for many centuries now. The area under cotton increased from 76 lakh hectares (lha) in 1960-61 to about 134 lha in 2019-20. Although the crop is grown in various States, — Maharashtra, Gujarat and Telangana account for about 70 per cent of India's total area in 2019-20. But, the area under cotton declined sharply from 3.96 lha to 1.69 lha during the same period in Tamil Nadu, where a large section of textile companies is demanding a reduction in yarn price.

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