Govt, traders differ on cotton export figures

Union Minister for Textiles Shankarsinh Vaghela today said that the cotton exports this year might not go beyond the last year's figure of 55 lakh bales (170 kg each) due to the rupee appreciation.

Speaking at a conference, the minister said, "The stronger rupee has affected almost all the commodity exports from India. Cotton is no exception." He said that the Central government was taking all possible steps to safeguard the exporters' interests.

However, the cotton traders of Gujarat, one of the largest cotton producing state in the country, disagree with the minister's projections. They said that the global situation of cotton production and consumption clearly indicated that the exports would be 5 per cent more this year. One of the main reasons cited for the rise is the demand from China.

"India's cotton exports are likely to go beyond 60 lakh bales this year. The global demand-supply gap for cotton has widened this year. The total global production of cotton has shrunk by 3 per cent, while the consumption has increased 4 per cent," said an Ahmedabad-based cotton trader and analyst.

He further said the mill consumption in China had increased by 5 per cent and the country was likely to consume 1.1 crore tonnes (5.1 crore bales) of cotton this year.

Another trader said that the loss incurred by the exporters due to stronger rupee would be compensated by the increase in the volumes.

Meanwhile, the Union Minister of Textile said that the country would have a record production of around 3 crore bales this year.

According to the International Cotton Advisory Committee (ICAC), which represents 22 nations, the cotton production in India will be around 3.1 crore bales. However, it said that the mill consumption of cotton in India was likely to increase by 6 per cent to 42 lakh tonnes (1.9 crore bales) during 2007-08, thus resulting in a drop in exports.