Govt Keeping Track Of Raw Silk Prices: Sharma.

The government is keeping a close watch on the prices of raw silk in the country and promised "intervention" if the domestic producers were adversely affected after its decision to slash import duty on raw silk by 25%.

Commerce and Industry Minister Anand Sharma said that he is "aware" of the dip cocoons prices in Karnataka, which accounts for nearly half of the country's raw silk production.

The government had reduced the import duty on raw silk from 30% to 5% in the 2011-12 budget, a move that sericulture farmers, in Karnataka, say triggered a freefall in the price of cocoons.

When asked if the Centre would roll-back the cut, Sharma said he cannot comment on what the Finance Minister would do.

However, he added, "We are keeping a very close watch".

The Minister said when the import duty was reduced, there was a demand-supply mismatch, with users of raw silk wanting more to be made available and it was in that background that the decision then was made.

"If there is ever a situation that presents itself where the domestic producers are hurt or affected adversely, there will be intervention," Sharma said.

Source : moneycontrol.com