)
Agriculture Minister Sharad Pawar today said a group of ministers has been set up to look into the proposal to levy export duty of 10% on cotton beyond a declared exportable surplus.
"The Cabinet has not taken any decision on this issue. The proposal has been referred to a group of ministers (GoM). It will look into all aspects," Pawar told PTI.
Besides Pawar, the GoM would comprise of Commerce Minister Anand Sharma and Textiles Minister Kavuru Sambasiva Rao among others and the panel is expected to hold its first meeting soon, sources said.
Due to differences of opinion among key ministries, the Cabinet Committee on Economic Affairs (CCEA) had on September 12 deferred a decision on the cotton distribution policy that proposed a 10% export duty on on cotton beyond a declared exportable surplus.
Currently, there is niether any export duty nor restriction on quantity of shipment of cotton after registering contracts with the Directorate General of Foreign Trade (DGFT).
The proposal by the textiles ministry aims to put in place a stable, transparent, production and tariff driven cotton market to balance the interests of stakeholders in the entire value chain.
Under the policy, the ministry had recommended an export duty of 10% ad valorem at freight on board (FOB) or Rs 10,000 per tonne, whichever is less, for all cotton exports exceeding the declared/revised exportable surplus.
The duty has been proposed to encourage shipments of value-added textiles and contain the current account deficit.
Cotton production in India, the world's second-largest cotton exporter and producer, is estimated at 34 million bales in 2012-13, as against 35.2 million bales a year earlier. China accounts for about 75% of its total exports.
