Agri Business

Sharad Pawar asks Andhra Pradesh to deregulate cottonseed prices

K. V. Kurmanath Hyderabad | Updated on April 06, 2011

cotton

Even as the Andhra Pradesh Government is readying a plan to fix cottonseed prices, Mr Sharad Pawar, Union Minister of Agriculture and Food Processing Industries, had asked the State to deregulate the cottonseed pricing so that seed companies could pay more remunerative prices to seed growers.

In a letter to Mr N Kiran Kumar Reddy, the Andhra Pradesh Chief Minister, last month, Mr Pawar felt that imposition of price controls, especially at a time when most of the sectors of economy are opening up, would only ‘bureaucratise' the seed industry.

The State Agriculture Department has initiated talks with cotton farmers, seed growers and seed companies to take a decision on the latter's demand that price for Bollgard-I and Bollgard-II should be increased for the ensuing kharif season. They wanted a hike of Rs 200 on BG-I (from Rs 650 to Rs 850) and Rs 300 on BG-II (from Rs 750 to Rs 1,050).

The Commissioner for Agriculture is expected to send a report to the State Government suggesting the tags for BG-I and BG-II for the coming season. A decision is expected this week.

“A competitive and vibrant seed industry would be able to serve the interests of farmers by ensuring the timely availability of cottonseeds at reasonable prices,” Mr Pawar observed in the letter, a copy of which is available with Business Line.

Price leash

Andhra Pradesh had imposed price controls on Bt cottonseeds due to which their prices had remained unchanged in the last few years despite “substantial increase in their cost of production.”

High prices of raw cotton this year dis-incentivised seed growers, making them to shift to commercial cotton from seed growing.

“The area under Bt cottonseed cultivation has reportedly come down. This would adversely affect the availability of Bt cottonseeds in future.

In the long term this would harm entire cotton economy,” he cautioned.

“This trend can only be reversed if cottonseed farmers are paid substantially higher prices to encourage them to continue with production of Bt cottonseeds. This needs revisiting of policy that regulates cottonseed pricing,” he said in the letter.

Published on April 06, 2011

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