The importance of cotton sector to the Indian economy in terms of farmers’ welfare, employment and income generation, value-added multiple downstream products and export earnings is well recognised.

We have the world’s largest area under cotton cultivation (125 lakh hectares). With production of 320-330 lakh bales, we rank either first or second in global production. Also, we are a significant exporter of raw cotton, cotton yarn and value-added textiles.

But the cotton sector is at a crossroads today. One side is the High Road that will lead to higher productivity and production, benefit primary producers (growers), provide sufficient raw material for our expanding consumption demand, and still leave a genuine export surplus.

The other side is a Low Road that may lead to stagnating production, supply-demand mismatch, volatile prices, falling export surplus, rising import dependence and all its consequential impacts on the economy and value chain participants. Stakeholders including policymakers have to choose the road they want to take.

Consider the following.

· Land available for cotton cultivation is stagnating; perhaps reaching a saturation point; don’t expect dramatic expansion of planted area because of competition among crops for acreage

· Our yields are declining after peaking at ~ 500 kg/ha five years ago; they are down to ~440 kg/ha now

· Land constraints, water shortage and climate change are seen hurting Indian agriculture in general and cotton in particular

· It is critical to recognize the risks posed by climate change; it is wishful-thinking that in the coming years weather conditions will improve and prove beneficial; actually it can get worse.

· There is strong positive correlation between economic growth and cotton consumption. Cotton is known as ‘growth commodity’ like steel and copper.

· With the ambition of a $ 5 Trillion economy, demand for cotton is sure to expand robustly in the next several years. Income increases, demographic pressure and current low per capita usage will be the drivers

· I foresee cotton demand to gradually rise to about 380 lakh bales by 2030;

· But the big worry is – under ‘business-as-usual’ conditions - cotton production growth may be slower than demand growth.

· In the event, there will be demand-supply mismatch, price volatility and hardly any genuine export surplus of raw cotton.

· Fall in crude oil prices due to ‘energy transition’ efforts of countries will make synthetics cheaper and adversely impact the demand for cotton-based goods

· Same time, our import dependence for fine and extra-long staple varieties will increase.

As the area for cotton stagnates and possibly reaches a saturation point, the only way to boost production is by vertical growth that is raising yields. Intervention at multiple levels is necessary.

- Technological intervention

- Boosting genetic research

- Replicate high yield area experience in others

- Contract farming by large user units

Technology: Bt. Cottonseed is possibly facing technology fatigue; Pink Bollworm has acquired resistance as evidenced by repeated incidences of pest attack. Agronomic practices are not followed as per prescribed protocol. Example: Planting non-Bt hybrids and allowing refuge area. In north India, planting takes place ahead of the normal time. Growers need guidance. Stewardship is missing.

A supportive policy environment for investment in tech seeds is needed. But denial of IPR and tech premium discourages research. Price controls on tech seeds are best avoided.

Sucking pests are also taking a toll. New seeds (stacked genes) are available. Weeds are a big issue. Cost of manual weeding is high. Herbicide Tolerant seeds should be encouraged. Tech seeds by themselves will not raise yields; but they will surely prevent / reduce yield losses. Crop saved is crop produced

Genetic research: There’s need to fight climate change with climate-smart agriculture or climate-resilient crops. For the purpose, a supportive long-term policy to encourage firms to spend on R & D is the only alternative. Currently, many private seed firms have pared down their research expenditure because of non-supportive or uncertain policy environment. Seed research is a long-term play.

Replication: While all-India cotton yield averages around 450 kg/ha, a few districts enjoy twice the yield. There is something for stakeholders to learn from the experience of high-yield areas. Input management, agronomy and so on in high yield area can be replicated in other areas. Industry bodies can play a role in conducting awareness programs among growers.

Contract farming: Not the least is the moral duty of large user-industries to produce the required raw material through contract farming. FPOs can be good partners for contract farming. It will be a win-win for growers and industrial users. Proven models of contract farming are available. Also, available are scientific and transparent methodologies to price the output in advance.

Finally, India has to urgently impart a new vibrancy to its slowly degenerating cotton sector. All stakeholders including policymakers, research institutions, growers’ organizations, input companies, industrial users, exporters, traders and service providers have to come together with unity of purpose to design a long-term policy for sustained growth in a sustainable manner.

Cotton is nature’s gift to India; let us make cotton India’s gift to the world.

(Excerpts of speech delivered by the author at Cotton Association of India conference in Hyderabad on October 29, 2023)

The writer is a policy commentator and agribusiness specialist. Views expressed are personal