The Cotton Association of India (CAI), a national body representing mainly the interests of ginners, exporters and traders has represented to the Government for continuing the incentive for raw cotton exports under
Vishesh Krishi and Gram Udyog Yojana (VKGUY). The scheme grants to cotton exporters a duty credit scrip, equivalent to 5 per cent of the value of exports, until June 2009.
Uncompetitive
High domestic prices due to sharp hike in minimum support price (MSP), appreciation of the rupee and an unfriendly global marketplace have rendered export of Indian cotton uncompetitive. Extending the fiscal sop for a year would help boost exports and reduce burdensome domestic stocks, CAI has argued. Raw cotton exports from the country have more than halved this year from the record 80 lakh bales last year. Earlier, CAI recommended that the government could freeze the MSP and not raise it any further.
Source : Business Line