New Delhi, Dec 22 (PTI) The government today brought cotton yarn export under licence regime by putting it under the"restricted"category in the backdrop of sharp rise in prices, which have hit garment manufacturers.
The policy change notified by the Directorate General of Foreign Trade (DGFT) has put a hindrance to the cotton yarn export, even to the extent of 720 million kg permitted earlier. The move comes in the wake of 85 per cent jump in yarn prices in the last nine months. While traders have exhausted the registrations, up to the ceiling of 720 million kg, the actual exports aggregated 530 million kg. The registrations will expire on January 15 by which all export transactions have to be completed. Commerce Secretary Rahul Khullar told reporters that the government would review the situation after January 15 and then only decide whether to allow further exports."The limit at the present moment has been fixed at 720 million kg, that is subject to review. We will review that and come back to you by mid-January,"he said. He said the restriction would also be applicable to the yarn-making in the export processing and special economic zones, as of now. But, the government has been flooded with representations from these units seeking waiver from the export bar. Khullar said there is a tug of war between different segments of the textile industry -- yarn makers and fabric and garment manufacturers. While the yarn makers decry the restrictions, the move has come in as a relief to the garment makers. As for the export of cotton, exporters can ship only 2.5 million bales- the balance from the overall ceiling of 5.5 million bales imposed in September. However, the traders have to go in for fresh registrations with the DGFT and not the Textile Commissioner, as was the case earlier. The Confederation of Indian Textile Industry (CITI) said the basic problem arose out of high cotton prices.
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