Economy

Goyal meets textile industry to discuss rising cotton prices

BL New Delhi Bureau | Updated on: May 17, 2022
Piyush Goyal

Piyush Goyal

Garment exporters have been calling for a temporary ban on cotton exports

Worried about galloping cotton prices and their effect on the textile industry, Minister for Commerce & Industry and Textiles Piyush Goyal met stakeholders — including garment manufacturers, spinners and traders of cotton and cotton yarn — on Tuesday to discuss various options of dealing with the situation.

“As the present situation is perceived differently by different stakeholders, it is important to see things from everyone’s perspective. That is why the Minister called for a meeting of all stakeholders,” an official said.

Cotton prices have almost doubled since the beginning of the current season seven months ago, from ₹55,000 per candy to over ₹1 lakh per candy, increasing input costs for textile and garments manufacturers.

In mid-April, the Centre had decided to remove the 11 per cent import duty on cotton till September 30 of this year; however, this did not dent cotton prices. Instead, cotton yarn manufacturers increased prices by ₹40 per kg across categories earlier this month; following this, garment units in Tirupur threatened to go on a strike.

Garment exporters have been calling for a  short-term ban on export of cotton and cotton yarn to help cool prices so that they could retain their global competitiveness.

According to the Tamil Nadu Spinning Mills Association, the upward price revision of ₹40 per kg was not implemented by mills universally, either in Tamil Nadu or in other States. Most mills had either not brought about any change in the price of yarn or increased in minimally, it said.

“By and large, we allow market forces to operate. But if we see that there is a requirement for government intervention, it should be done. Whatever the Ministry will decide will be in the larger interest of the entire value chain,” Textile Secretary Upendra Prasad Singh recently told BusinessLine in an interview. 

Published on May 17, 2022
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