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Lowering cotton support price out of the question, Vaghela tells ginning mills

AHMEDABAD: Union Textile Minister Shankarsinh Vaghela on Tuesday rejected the demand by cotton ginning and pressing factories for lowering cotton support price. He assured growers that every bale produced by them would be purchased by the Cotton Corporation of India (CCI).

Admitting that the slowdown in the international market and resultant closure of many textile mills depressed the demand for cotton, Mr. Vaghela, however, said even if the CCI was forced to stock all bales in its warehouses for want of buyers, the government would not allow the farmers to suffer.

The Minister said the minimum support price at Rs. 2,850 a quintal for the best variety was 40-48 per cent higher than the MSP fixed for last year. For, the prices appreciated by about 40 per cent last year after the farmers had sold their stocks.

Rejecting the demand of the private ginning and pressing factories, he said they made hay last year when the prices went up in the international market and they should not object to the farmers reaping the benefit this year to make up for the losses.

All ginning and pressing units in Gujarat, which account for about 30 per cent of the cotton produced in the country, have been on strike for the past two days. The factory owners claimed that because of the high support price offered by the CCI, textile mills preferred to import cotton at lower prices and the ginning and pressing factories lost business.

Mr. Vaghela said production this year was expected at 322 lakh bales, up from about 300 lakh bales achieved last year. The CCI had already purchased about 13 lakh bales from cotton-producing States including about one lakh bales from Gujarat. It had opened 280 MSP centres, 48 of them in Gujarat alone, and was making purchases at 1.5 lakh bales a day.

The area under cotton increased from 76 lakh hectares in 2003-04 to 93 lakh hectares this year, production from 179 lakh bales to 322 lakh bales and productivity from 399 to 591 kg a hectare.

India had become the second largest producer after China, relegating the United States to the third place, and also emerged as the second largest exporter of cotton. However in the current year, the export was likely to drop from 85 lakh bales last year to 75 lakh bales due to the depressed demand, he said.

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