The Hindu Business Line : Anti-subsidy duty on cotton from US, EU mooted

INDIA should impose an anti-subsidy duty on cotton imports from the US and the European Union, to neutralise the adverse impact of subsidies given to growers and exporters in these countries, a senior Government official has said.

"These subsidies depress international cotton prices which in turn impacts income to cotton growers here,'' Mr Subodh Kumar, Textile Commissioner, said at the annual general meeting of the All India Cottonseed Crushers' Association (AICOSCA).

He also advocated a strong interface between research and industry to identify seed varieties for commercial production.

According to Mr Sandeep Bajoria, Chairman, AICOSCA, the drop in cottonseed production during the current season (November-October) is of some concern as it is expected to pose a setback to scientific processing of cottonseed.

During the current season, 1.56 lakh tonnes of cottonseed out of the available 36.29-lakh tonnes would be processed scientifically compared to 2.11 lakh tonnes processed in the previous season.

"Subjecting only about 4.3 per cent of the cottonseed to scientific processing is a dismal performance for India,'' Mr Bajoria said at its AGM.

AICOSCA has been pushing for scientific processing of cottonseed as India has a huge population of undernourished and protein-starved cattle.

Although the industry had been driving scientific processing, the returns had not been favourable. Cottonseed extraction after scientific processing was sold at prices lower that cottonseed oilcake processed through traditional method, Mr Bajoria said.

In the current season, average prices of cottonseed rose by 35 per cent over the previous season because of the shortfall in cotton production. A similar rise was seen in cottonseed oil. Prices of undecorticated cottonseed cake rose by 17 per cent and decorticated cake by 15 per cent during this season until 2003.

Mr Bajoria said undecorticated cake with protein content was priced higher than the cake with higher protein content. But the industry was taking measures to reverse this trend.

During this season, restrictions on the export of linters were lifted. This should result in an improvement of exports of linters, he said.

The 2003-2004 season should augur well for the cottonseed industry primarily because rains had been timely and adequate in most of the cotton growing States, Mr Bajoria said.

During the current season ending October 31, 2003, cottonseed production was down at 45.29 lakh tonnes compared to 52.61 lakh tonnes. Availability of cottonseed for processing is estimated at 36.29 lakh tonnes (41.31 lakh tonnes).

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