New Delhi (IANS) Apparel Export Promotion Council (AEPC) has sought for imposition of quantitative restrictions and export duty on export of cotton yarn from India.
In a letter to the Union Minister of Textiles Smriti Zubin Irani, AEPC Chairman A. Sakthivel said that 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.
"We request your kind immediate intervention to increase the supply of yarn to domestic manufacturers. We suggest that quantitative restrictions should be imposed on exports of cotton yarn, specifically on cotton yarn of 26 counts and above," the letter said.
Sakthivel also noted that apparel exporters were grateful to the minister for her continuous support in bringing stability in cotton price and predictability in availability of cotton, which encouraged Cotton Corporation of India (CCI) to reduce the price of cotton to small mill owners.
However, he added that, the move did not result in 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 availability of yarn means that garment exporters cannot honour commitments they made to their customers," the AEPC Chairman said.
This has also affected handloom and powerloom weavers badly and looms have stopped production, he said, adding that "due to this, the domestic industry has also got affected adversely".
He suggested that export duty should be levied on exports of cotton yarn. This will result in a sharp decline in domestic yarn prices and an increase in value addition and employment in the country and will also help in increasing garment exports, Sakthivel said.