Textile Associations Urge Intervention On CCI Cotton Trading Policies

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January 20, 2024 New Delhi, Jan 20 (KNN) The Confederation of Indian Textile Industry (CITI) has sought government intervention to tackle the challenges confronting the trading policies of the Cotton Corporation of India (CCI).

CITI, and allied textile associations, jointly presented a memorandum to Piyush Goyal, Minister of Textiles, to address concerns related to CCI’s Minimum Support Price (MSP) cotton procurement practices, proposing revisions to ensure price stability and a seamless supply to downstream sectors.

The textile industry emphasises that current practices favour multinational cotton traders, leading to speculation in cotton prices that adversely affect yarn prices and exports of cotton-based textile and clothing products.

Given the financial strain on the Micro, Small, and Medium Enterprise (MSME) spinning segment, the memorandum calls upon Piyush Goyal to implement several measures, including initiating CCI cotton sales to registered textile/spinning mills from February/March.

It advocates retaining MSP-procured cotton as a buffer stock, releasing it based on international price differentials to ensure price stability. Monthly price announcements, factoring in MSP procured price, carrying charges, and other incidental charges, are also proposed.

Further recommendations include extending a uniform free period of 60 days for all actual users, collecting a one-time Earnest Money Deposit (EMD) of 10 per cent for advance booking, providing a key loan facility by storing pre-booked cotton at individual mill premises for day-to-day use against payment, selling cotton in multiples of 130 to 150 bales (one truckload) on par with MCX to benefit small spinning mills, and establishing a Sub-Committee to monitor CCI's trade practices and prices, taking corrective measures when necessary.

Emphasising the mutual benefits for CCI, the Government, and the user industry, the joint memorandum underscores the adoption of these policies to ensure stability in cotton prices, safeguard the interests of MSMEs, and foster the long-term growth of the Indian cotton textiles and clothing industry.

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