Chennai, Dec 4 (): Chief Minister and DMK party leader Mr. M. Karunanidhi has asked the center to order immediate suspension of cotton exports and restrict the level of cotton yarn exports to ensure availability of raw material for the country owned textile sector.
In a letter to the Prime Minister Mr. Manmlhan Singh, Mr. Karunanidhi stated that cotton prices had increased to 20 per cent between the last few weeks of September and November. Certainly, the decision to permit 55 lakh bales for exporting had led to a continuous increase in cotton prices.
Hectic buying by cotton exporters had led to insufficient arrivals in the market. It was the period after October that witnessed a dip in cotton prices owing to fresh arrivals in the market. But, the approval for 55 lakh bales had resulted in a hand-to-mouth situation.
Mr.Karunanidhi also noted that there was no cotton available in the market to build up on stocks, citing attention to his earlier request in September to stop letting exports before fully meeting domestic needs.
He also compared the ratio of China, one of the beneficiaries of our cotton exports, maintains stocks to use ratios of 33% whereas India’s stock to use ratio is just about 17 %.
It was prior requirement to build up cotton stocks during these seasons which would last till January and this could provide maximum employment, next to agriculture, it was always kept continuously fed with raw material, he said, pointing out that the handlooms and power looms together employs about 5 million people in the State. The employment provided by them to the country was several times higher, he pointed.
The prices of Cotton yarns had also witnessed a sharp increase following the trend in cotton prices. It was highly necessary to moderate yarn exports to make value addition feasible, downstream, in the textile industry to enable higher production of power loom cloth, knitwear, handloom cloth and garments, he said demanding a limit to the yarn exports.