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Cotton Industry Seeks Stable Prices, Lower Import Duty Amid Volatility

The cotton textile industry has called for stable and competitive cotton prices amid ongoing volatility. Confederation of Indian Textile Industry Secretary General Chandrima Chatterjee highlighted that raw material costs constitute 70-80% of industry expenses. She urged the removal of the 11% import duty on cotton to improve competitiveness against Bangladesh and Vietnam. The industry also requested direct procurement to mills rather than traders to ensure price stability.

Key Points: Cotton Industry Seeks Stable Prices, Lower Import Duty

  • Industry seeks stable and competitive cotton prices
  • Raw material costs account for 70-80% of costs
  • Removal of 11% import duty urged for competitiveness
  • Calls for direct procurement to mills to curb speculation
3 min read

Cotton industry seeks stable prices, lower import duty amid volatility concerns: Secy General CITI

The cotton textile industry urges stable prices and removal of 11% import duty to boost competitiveness against Bangladesh and Vietnam.

"A sudden jump in prices is not good for competitiveness - Chandrima Chatterjee"

New Delhi, May 7

The cotton textile industry has sought stable and competitive cotton prices along with predictable raw material availability, as volatility in cotton prices continues to remain a key concern for manufacturers and exporters.

Speaking to ANI, Confederation of Indian Textile Industry (CITI) Secretary General Chandrima Chatterjee said the industry is looking forward to the implementation of the government's Cotton Mission announced for the next five years, while highlighting the need to address productivity and price stability challenges.

"We are looking forward to the implementation of the cotton mission as soon as possible. But there is a big issue that India's productivity has become low. India's productivity has become half of the world's average," Chatterjee said.

She said the industry expects cotton prices in India to remain competitive with other textile manufacturing countries such as Bangladesh and Vietnam.

"Cotton prices should be competitive. Competitor countries like Bangladesh and Vietnam are getting cotton at the same price. Stable and predictable pricing is important for the industry," she said.

According to Chatterjee, raw material costs account for nearly 70-80 per cent of the textile industry's overall cost structure, making sudden price increases difficult to absorb.

"Margins are nominal, and raw material cost is 70-80 per cent. A sudden jump in prices is not good for competitiveness," she said, adding that order cycles in the industry are short and pricing uncertainty impacts execution.

Referring to consultations with the Cotton Corporation of India (CCI) and the Ministry of Textiles, she said the industry is seeking a "balanced view" to ensure stability in cotton procurement and pricing.

She added that the industry has requested that procurement be directed towards mills and manufacturers to ensure smoother supply availability and reduce speculative pricing in the market.

"Our request is that procurement should be given directly to industry, not to the trading community, so that the price remains stable and the mills and industry get a viable cost," she said.

On policy measures, Chatterjee said the removal of import duty on cotton could help improve competitiveness for the domestic industry.

"The easiest way would be to remove import duty because 11 per cent import duty is a huge amount. India is among the few cotton-producing countries with such an import duty, and after that, it becomes very difficult to retain competitiveness in the industry," she said.

She also noted that industry consultations on the Cotton Mission have included discussions on seed costs, mechanisation, branding and implementation aspects aimed at improving productivity and strengthening the sector over the long term.

- ANI

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Reader Comments

S
Sarah B
Interesting to see how Indian textile industry is struggling with the same raw material cost issues we see globally. The suggestion to give procurement directly to mills rather than traders makes practical sense - middlemen always add to price volatility. However, completely removing import duty might hurt our domestic cotton farmers. Need a balanced approach.
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Priya S
As someone from a textile family in Coimbatore, I can tell you this is spot on! 🧵 Raw material cost is killing us. When cotton prices jump suddenly, we can't renegotiate export orders. The government should listen - remove import duty but also support farmers with better seeds and MSP. Don't sacrifice one sector for another!
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Aditya G
The productivity concern is alarming - half the world average! 😞 We have good land, good farmers, but lack modern techniques and mechanisation. The Cotton Mission should focus on high-yield seeds, better irrigation and farmer training. If we can increase yield, we won't need to worry about import duty as much.
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Deepak U
I'm a cotton farmer in Maharashtra and this makes me nervous. Stable prices for industry is fine, but what about us? 😔 If they remove import duty, cheaper cotton from abroad will flood in and our prices will crash. The CITI wants competitive prices but farmers need remunerative prices too. Government must balance both!
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Michael C
As an export consultant who works with Indian textile firms, I see this daily. The 11% import duty makes Indian yarn more expensive than Bangladeshi or Vietnamese alternatives. 🏭 With global buyers demanding competitive rates, this issue is hurting our export competitiveness badly. Hope the government acts fast on the Cotton Mission.

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