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CHAPTER VI Raw Material
COTTON Cotton is one of the major crops cultivated in India . It accounts for more than 75% of the total
fibre consumption in the spinning mills and more than 58% of the total fibre
consumption in the textile sector. The twin objectives of assuring off-take of
the farmers’ produce at remunerative prices and making available adequate
quantity of cotton at a reasonable prices to the domestic textile industry,
are sought to be achieved through timely announcement of remunerative Minimum
Support Price (MSP) to the farmer and through appropriate export-import
intervention as and when necessary. PRODUCTION AND CONSUMPTION During the last four decades, the production of cotton rose from
30 lakh bales in 1950-51 to an all time high of 177.90 lakh bales (170 Kgs
each) in 1996-1997 and there has
also been an increase in the area under cultivation from 58.91 lakh hectares
in 1950-51 to 93.87 lakh
hectares in 1998-99. The average yield per hectare also rose form 88 kgs in
1950-51 to 330 kgs in 1996-97.
In the Cotton Advisory Board’s meeting held on 24.02.2001 for the cotton
season 2000-2001, the production of cotton has been estimated at 146 lakh
bales (inclusive 8 lakh bales of loose cotton), area at 81.22 lakh hectares
and the average yield per
hectare at 305 Kgs. One of the
reasons for low yield in India as compared to world average of about 580
kg/hectare is that 65% of the area under cotton cultivation is rainfed. The largest share in the total production of cotton is of medium
staple variety followed by long staple.
The share of short staple is about 7%. The share of medium long staple is presently 42% and that
of share of long and extra long staple variety is 51% in 1998-99. The main cotton producing States are
Gujarat, Maharashtra, Andhra Pradesh, Punjab, Madhya Pradesh, Rajasthan,
Haryana, Karnataka and Tamil Nadu. Consumption of cotton has been increasing over the last few
years. As against the total consumption of 115.50 lakh
bales during 1990-91 (Mill and
Non-Mill), the consumption level including consumption by spinning units in
the Small Scale Sector has been to the tune of 173.36 lakh bales in 1999-2000
(Oct.1999 to Sept. 2000) The domestic consumption for 2000-01 is estimated of
173 lakh bales. The variety-wise demand for cotton follows the same pattern
as the variety-wise production in that the major demand is for medium staple
variety. The demand for short
staple and extra long staple is relatively lower. Data on area
production, yield and consumption of cotton is given in Table 6.1.
PRICES OF COTTON The Government announces Minimum Support Price (MSP) for
varieties of cotton every year to ensure remunerative prices for the cotton
growers. The Cotton Corporation
of India (CCI) is the only
agency for implementation of this policy in the country except the State of
Maharashtra. The CCI enters the
market and makes purchases of
cotton under support price operation whenever prices come below the
MSP level. The market
prices of all varieties of kapas ruled well above the support prices during
the year 1999-2000 except for J-34 variety in the north for a brief period in
November and December, 1999 when
the CCI had immediately stepped in and made purchases of 7874 bales of
J-34 variety of kapas at some places in the States of Rajasthan and Punjab.
Commercial operation of the Corporation continued as usual. The Government of India has fixed the Support Price of two basic
varieties of cotton, viz. F-414/H 777/J-34 and H-4 of new crop kapas of Fair
Average Quality for Cotton Season 2000-01. The Support Price for F-414/H-777/J-34 variety has been
fixed at Rs.1625/-per quintal, an increase of Rs.50/- per quintal over
1999-2000 Support Price.
Similarly, the Support Price for H-4 (Long Staple) variety has been
fixed at Rs.1825/- per quintal, an increase of Rs.50/-per quintal over
Support price of 1999-2000. For other varieties, the Minimum Support
Prices are announced by the
Textile Commissioner based on market differentials. Table 6.1
During the cotton season 1999-2000, the Government had released
an export quota of 5.00 lakh bales of cotton to State Federations, Private
Trade, NAFED, CCI, General Ginners and modern ginning and pressing units. Due
to lower cotton crop in that year and the prevailing lower international
prices coupled with poor response for Indian cotton from abroad, the
Government did not release any further export quota during 1999-2000. As against the above quota released,
the actual export was 0.652 lakh
bales valued at Rs.83.60 crores. Further, a quota of 1 lakh bales of cotton waste was
also released for export in
1999-2000. However, the actual shipment was only 0.299 lakh bales of cotton waste valued at
Rs.24.23 crore. For the cotton year 2000-01, (October-September) the Government
has released (till Fubruary
2001) an export quota of 9 lakh bales of raw cotton and one lakh bales of
cotton waste. COTTON ADVISORY BOARD The Cotton Advisory Board is a representative body of the
Government/Growers/Industry/ Trade.
It advises the Government generally on matters pertaining to
production, consumption and marketing of cotton and also provides a forum for
liaison among the cotton textile mill industry, the cotton growers, the cotton
trade and the Government. The
Board as reconstituted on 19.5.99, has 40 Members, of which 6 are Central
Government Nominees, 7 State Government Nominees, 6 representatives of cotton
growers, 7 representatives of the Textile Industry, 5 representatives of the
Cotton Trade, 4 representatives of the cotton Research and Development, 2 representative of the Powerloom Sector, 2 representatives from the
Handloom Sector and 1 representative from the Ginning and Pressing
Sector. The reconstituted Board is valid up to 18.5.2001. INTERNATIONAL COTTON
ADVISORY COMMITTEE(ICAC) The International Cotton Advisory Committee is an association of
governments having an interest in the production, export, import and
consumption of cotton. It is an
organization designed to promote cooperation in the solution of cotton
problems, particularly those of international scope and significance. The functions of the International Cotton Advisory Committee, as
defined in the Rules and Regulations, are :-
For the fiscal year 2000 (July, 2000-June, 2001), India’s
contribution to ICAC is US
$ 26,400 (approximately
Rs.12,00,000/-). The 59th Plenary Session of ICAC was held in Cairns, Queensland,
Australia from 5th November, 2000 to 10th November, 2000. The Indian delegation, led
by Shri Vishwa Nath,
Chairman-cum Managing Director, Cotton Corporation of India Ltd. (CCI)
presented the country statement.
The theme of the meeting was “Cotton-Global Challenges”. Member
Governments discussed production and export subsidies, import tariffs and
other trade barriers that distort prices, production and trade in cotton and
cotton products. The committee
reviewed efforts to enhance the competitiveness of cotton, and agreed that
the highest priority must be assigned to meeting the changing quality needs
of textile manufacturers and consumers. The World Cotton Research Conference-3 will be held in Capetown,
South Africa during March, 2003.
The 60th Plenary Meeting of the ICAC will be held in Victoria Falls,
Zimbabwe from September 16-21, 2001. Cotton Technology Mission In view of a long felt need to have a co-ordinated approach to cotton
development, a Cotton Technology Mission was launched by the Government in
February, 2000. The Mission
comprises four mini missions with specific objectives of ‘research’,
‘dissemination of technology to farmers’, ‘improvement in market infrastructure’
and ‘modernisation of ginning and pressing sector. A total amount of Rs. 593 crore has been allocated for the
four mini missions for the last three years of the Ninth Five Year Plan. The Ministry of Textiles is
implementing Mini Missions III & IV relating to improvement in market
infrastructure and modernization of Ginning & Pressing factories. As on 31st January,
2001 under MM-III, project proposals for improvement of 20 market yards,
activation of 10 market yards and setting of 4 new market yards have been
sanctioned. The total estimated
cost is Rs.43.56 crore out of which Government of India share would be of
Rs.23.93 crore. Under MM-IV, 100 proposals for modernization of ginning and
pressing factories at an estimated cost of Rs.99.13 crore have been
sanctioned, out of which Government of India share would be of Rs.19.38 crore. MAN-MADE FIBRE &
FILAMENT YARN INDUSTRY The man-made fibre & yarn industry comprises fibre and
filament yarn manufacturing units of cellulosic and non-cellulosic origin. The cellulosic fibre/yarn industry is
under the administrative control of the Ministry of Textiles while
non-cellulosic industry is under the control of Ministry of Chemicals &
Fertilizers (Department of Chemicals & petro Chemicals). This industry has a vital role to play in the Textile industry in the sense that
about 39% of the raw material
consumed is manufactured by the man-made fibre/yarn industry. The production
of man-made fibre /yarn, in general is expected to increase during 2000-2001
as compared to the production during 1999-2000. The production of viscose
staple fibre during 2000-2001 is expected to increase by 20% as compared to
1999-2000. The production of polyester staple fibre & polyester filament
yarn during 2000-2001 is expected to increase by 3% and 6% respectively over
the previous year. The production of acrylic staple fibre is expected
decrease by about 43%. The production of viscose filament yarn is expected to
significantly decline by 20% over previous year. The production of nylon
filament yarn is also expected to decline by about 1% in the same period. The
installed capacity and the details of production during the last eight years
are given as mentioned in Table 6.2. Table 6.2
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