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After wheat, there is pressure building up for banning exports of raw cotton. The Narendra Modi government must resist any such demand emanating from domestic textile mills and the garment industry. There are at least three reasons why this is so. To start with, the output of one industry is often the input of another. In this case, cotton is spun by mills into yarn, which is further woven or knitted into fabric used for making garments. During the year ended March 31, 2022, India exported $2.8 billion worth of raw cotton, $5.5 billion of cotton yarn, $8.2 billion of cotton fabrics and made-ups, and $9 billion of cotton ready-made garments. Will spinning mills seeking a ban on cotton shipments agree to the same in respect of yarn? When exports are happening at every stage of the value chain, how can there be pick and choose on which one to disallow or promote? Secondly, while it is true that cotton prices have risen by around 50 per cent since the start of 2022, this cannot be blamed just on exports - which are actually expected to halve in the current marketing season (October-September) compared to 2020-21. Domestic prices increasing to international parity levels should, by itself, slow down exports in the natural course. The Modi government did the right thing last month by scrapping the import duty on cotton. It should, in fact, remove the 10 per cent duty on yarn imports as well. The correct approach to tackling inflation, whether in wheat, cotton or yarn, is by allowing duty-free imports without putting fetters on exports. The third reason has to do with timing. Sowing of cotton has already started in Punjab, Haryana and Rajasthan. Plantings in Gujarat, Maharashtra, Telangana and other states will also take off with the arrival of the southwest monsoon rains. High prices would definitely incentivise farmers to expand acreage this time; banning exports will send the opposite signals to the ultimate detriment of the textile industry. The real problem in cotton that needs addressing is yields. The introduction of Bt cotton in the early 2000s led to India's production going up about 2.5 times to 398 lakh bales by 2013-14. Since then, it has been on a falling trajectory, with the latest output estimate for 2021-22 at below 325 lakh bales. The plants incorporating Bt genes have over time developed susceptibility to pink bollworm and whitefly insect pests, reducing yields and also farmer enthusiasm for growing cotton. The Modi government's succumbing to uninformed lobby pressures against genetic engineering technologies has not helped matters. A clearheaded approach is required for this crop, which is a source of not just fibre (lint), but also food (cotton-seed oil) and feed (oil-cake).
The main suggestion in the above passage is...

Updated On: Oct 17, 2024
  • Due to increasing prices of cotton, India's export competitiveness will increase in the international market
  • The real problem in cotton cultivation is area under cultivation not the yield
  • There should be a temporary moratorium on cotton export
  • Union Government need not ban cotton export
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The Correct Option is D

Solution and Explanation

The correct option is (D):Union Government need not ban cotton export
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