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The textile industry has hailed the latest round of cabotage relaxation as it would help in faster transportation of cotton.
The Southern India Mills’ Association Chairman P Nataraj said it would benefit cotton farmers in Gujarat and spinning mills in Tamil Nadu.
Cotton from Gujarat
“The mills in the State consume around 50 lakh bales of cotton grown in Gujarat every year as its fibre quality parameters are preferred by the knitted garment makers in Tirupur. But we were losing heavily on transporting the cotton,” he said.
During the peak cotton season, the lorry freight per bale between the ginning factories in Gujarat and spinning mills in Tamil Nadu can touch a high of ₹1,000, while the transportation cost for importing the fibre from West Africa worked out to just ₹400/bale.
Costly transportation
This forces the industry to transport the fibre by rail and ship. But the price difference between lorry and these modes of transport was less than 10 per cent. The industry sought relaxation of the cabotage rule for transporting cotton from Gujarat to Tamil Nadu and use of foreign-flagged vessels to carry cotton.
The SIMA Chairman perceives that the foreign-flagged vessels might be in a position to offer a competitive rate as a large number of empty foreign containers are transported between the Gujarat and Tamil Nadu ports.
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