Insight on India’s Cotton Exports: Current Scenario & Challenges Ahead

Cotton is regarded as the best fabric for skin by all fashion brands worldwide. The textile industry in India contributes 14% of the total industrial production and 11% of the total export earnings of the country. The industry is predominantly cotton-based, so this raw material plays a huge role in the Indian economy. The country is also one of the largest producers and exporters of cotton worldwide. The cotton produced in India is exported to about 150 countries across the world. The major importers of the Indian cotton are Bangladesh, China, Vietnam and Pakistan. According to the available cotton and apparel exports data, export earnings from this crop was USD 6,262 million during the year 2016. The Government of India is also taking initiatives to increase the export earnings from cotton. Indian cotton has better quality and a huge potential that can fetch it a higher price. Despite this fact, Indian farmers and traders are getting a lower price due to the lack of branding initiatives. To combat this issue, in 2017, the Government considered revision of TMC (technology mission on cotton) to accommodate cotton contract farming and branding of cotton. Under the TMC guidelines, it was decided that cotton exporters would be allowed to improve the quality of Indian cotton by ensuring lesser contamination, trash and staple length in raw fibre as the Egyptian and American cotton. In the marketing year 2017-18, which started on October 1, it was estimated that cotton production during this year will be around 40 million bales as there was a 19% increase in the area planted for cotton. With this production, it was estimated that export surplus for this year will be around 7.5 million bales of 150kg each. However, due to damage to the cotton crops, it is estimated to export one-fifth less cotton than expected. The damage was mainly in the Indian state of Maharashtra, the biggest cotton grower. Farmers found that around 50% of their crop was infested with the pest, pink bollworm that consumes cotton fibre and seeds inside the boll. Unfortunately, the infestation has occurred to the genetically modified seeds of the cotton known as Bt cotton. In 2006,the Government approved this seedas it was highly resistant to the pest. However, the pink bollworm was developing resistance to this technology and has started affecting the crop on a large scale. It is the result of this damage that the export surplus of the country has reduced and lower exports from the world’s biggest producer is giving an advantage to rivals like US, Brazil and Australia to increase their exports to Asian Buyers like China, Bangladesh, etc. The Government has acted upon this problem by deciding to sell hybrid seeds from next year or mixing in refuge seeds. Cotton’s importance as an export material for India has increased over time. In order to increase the earnings from this important crop, the country has to maintain the production and export quality and quantity consistently.