New Delhi: In a recent move, the Government of India exempted customs duties on all cotton imports from the 14th of April to the 30th of September. Farmers' groups, however, have opposed the move alleging that the Modi government has done this at the behest of corporate textile companies. Cotton imports are taxed around 11 percent, including cess and surcharges, in India.
“This move comes without ensuring assured remunerative prices and procurement of cotton grown by farmers in India. It is likely to lead to an inflow of cheap cotton from China, Brazil United States of America, and other places. In the absence of effective procurement and a Price Stabilisation Fund to ward off the adverse impact of such inflow on prices, this could lead to a further burden on the crisis-ridden cotton farmers in our country. It should not be forgotten that the cotton belt in India is having the highest number of suicides by farmers in distress,” said Ashok Dhawale, president of All India Kisan Sabha in a statement.
“The BJP government claims that this decision has been necessitated to help the textile industry cope with the raw material shortages. The Finance Ministry says that the scrapping of import duties was necessitated due to below-expected yields in the country and a surge in domestic cotton prices. On the pretext that the move is to ease the pressure on domestic textile industries’ export competitiveness vis-à-vis fellow competitors, it goes on to the unfounded claim that it would also provide relief to the consumers. It is a well-known fact that the big corporate textile industries never transfer benefits of cheaper raw materials to consumers as they are driven only by the motive of profit maximization” he added.
According to the AIKS, this decision of the Centre will spell disaster for the cotton farmers of our country who already are in acute crisis and unable to realize remunerative prices. "There is no protection guaranteed to the cotton farmer in the form of assured procurement at remunerative prices at least one and a half times the cost of production as of now. The inflow of raw cotton will lead to a further crash in prices and in absence of effective price stabilization; the burden of such crashes will fall on the poor farmers of India. This is the experience when import duty of raw silk was done away with," he adds.
Hence, the All India Kisan Sabha has demanded the Union government withdraw this decision, reinstate import duties on cotton, and make arrangements to procure farmers’ produce at remunerative prices. The farmers union also demanded that government should instead of scrapping import duties incentivize farmers. AIKS has called upon its units in the cotton-growing States to rise in protest against the insensitive decision.
