AEPC urges government to impose restrictions on exports of cotton yarn
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The Apparel Export Promotion Council (AEPC) Chairman A Sakthivel has urged the government to impose restrictions on exports of cotton yarn to curb prices and increase supply for domestic manufacturers. He said despite several efforts by the government to reduce the price of cotton yarn, it has consistently increased in the last four months and was affecting the entire value chain.
Sakthivel suggested that quantitative restrictions should be imposed on exports of cotton yarn, specifically on cotton yarn of 26 counts and above. This will result in a sharp decline in domestic yarn prices and an increase in value addition and employment in the country. This will also help in increasing garment exports. And, it will result in only normal profits accruing to yarn spinners, not the supernormal profit owing to the profiteering currently happening.
AEPC Chairman stated that the Cotton Corporation of India (CCI) has reduced the price of cotton for small mill owners but this did not result in a reduction of cotton yarn prices. The rate of increase in yarn prices far exceeds that of cotton prices. The steep increase in prices and unpredictability in the availability of yarn means that garment exporters cannot honor commitments they made to their customers. This has also affected handloom and power loom weavers badly.
