The Tirupur Exporters Association (TEA) on Friday said the DGFT should not remove restriction on cotton yarn export as it would directly impact downstream sectors and trigger increase of cotton yarn prices, coupled with its non-availability in the domestic market.

As against the previous policy of exports under licence, the Directorate General of Foreign Trade (DGFT) allowed cotton yarn exports after registering with it, a government notification said yesterday.

In a statement, TEA President Mr A Sakthivel said the notification has come at a time when the knitwear sector was facing various problems, further to closure of dyeing units and increased yarn prices.

The value added garment sector would find it difficult to face competition from other nations importing cotton yarn from India, with their inherent advantages in Bank interest rates, refund of Value Added Taxes, power cost over Indian exporters, “who would compete well and dent our market share,” he said. Apart from losing additional foreign exchange, lakhs of people would be rendered jobless, he said.

In a letter to Union Commerce and Industry Minister Mr Anand Sharma, Shaktivel requested him to take up issues like calibration of yarn exports on a monthly or quarterly basis, count-wise cap from 1s to 40s and to fix the maximum quantity of exports ceiling at 720 million kg as per last fiscal.

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