Chennai, 30 Nov (KNN) M K Stalin, Chief Minister of Tamil Nadu has written to the Union Textiles Minister Piyush Goyal highlighting the instability of cotton and yarn prices impacting apparel manufacturers.

He urged Textile Minister Goyal to remove the 11% Import Duty on cotton, revamp the commercial terms and conditions prescribed by the Cotton Corporation of India (CCI) for e-auction of cotton and extend 5% interest subvention to the spinning mills towards procurement of cotton during peak season, as published in Deccan Chronicle.

“I understand that one of the major reasons for the cotton price  volatility is due to the imposition of 5% Basic Customs Duty (BCD),  5% Agriculture Infrastructure Development Cess (AIDC) and  10% Social Welfare Cess imposed on these components in the Union  Budget 2021-22 which amounts to imposition of an overall import duty of 11%,” he said. 

The bulk discount offered by the Cotton Corporation of India (CCI) to the traders who procured almost 70% of Minimum Support Price (MSP) cotton auctioned by CCI at a lower rate during the cotton season due to availability of 90 days free period and thereafter speculated the  market is one more reason for spurt in cotton prices, Stalin said. 

The chief minister has warned that if this situation is not controlled a large number of apparel and  home textile units may soon become unviable resulting in closure  and consequent large scale unemployment and industrial unrest. 

Stalin told the Union Minister that the textile  industry was the second largest employment provider in the State and  Tamil Nadu accounted for one third of the textile business in the  country.

“The present crisis has led to mass cancellation of export orders and hardships in fulfilling long term export commitments,” he said. 

The chief minister has requested Union Minister Goyal to direct the concerned Ministries to intervene and take measures at the earliest to remedy the situation, protect the Textile Industry and prevent loss of jobs.