Govt To Allow Extra Export Of 1.5 mn bls Of Cotton.

Under pressure to ease quantity restrictions imposed on cotton exports, the government is likely to allow further shipment of 1.5 million bales in the current season, sources said.

Earlier, the government had allowed the export of only 5.5 million bales of cotton in 2010-11 and the limit has been exhausted by the exporters. The cotton season runs from October to September.

"There are indications that additional exports would be allowed, given the pressure from the farmers and ginning industry," the source said.

The ceiling on cotton exports was imposed in October last in the wake of a sharp rise in prices of the commodity hitting the domestic textiles industry. The apparel units had even resorted to partial closures as raw material prices went up.

However, the situation has taken almost a U-turn since March-end and prices of the natural fibre have shown a drastic fall.

In the domestic market, cotton prices have declined to below Rs 50,000 per candy (356 kg each) at present from the high of Rs 62,500 per candy two months ago.

Agriculture Minister Sharad Pawar has written several letters to Prime Minister Manmohan Singh seeking more cotton exports.

"Domestic cotton prices are going down. In such a situation, we have to see whether we can export. International market is good and I think we have to take a view at the earliest," Pawar yesterday told reporters here.

Source : economictimes.indiatimes.com