Cotton quality to be better this season, but India’s textile output likely to dip in 2018-19

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India’s cotton position would remain comfortable during the 2018-19 season as the minimum support price (MSP) is up 26 to 28 per cent, notwithstanding favourable monsoon condition as well, a top official of Indian Cotton Federation (ICF) said.

During the last cotton season, the trade had projected a very tight closing stock, but in reality the stock was comfortable, which in turn helped in a downward correction of the price.

The fourth advance estimate for 2017-18 cotton season had estimated the area at 124.29 lakh hectares. Industry sources expect this area to rise further this season as compared to the previous year.

“We are expecting cotton quality to be much better during 2018-19 compared to the earlier season in view of the efforts taken by the Cotton Corporation of India in enforcing quality parameters and ginning practices, ICF said.

However, thanks to the recent migrant labour trouble in Gujarat, India’s textile output is likely to show a decline. Gujarat is a major textile producer in the country which contributes nearly 80 per cent to India’s overall production in synthetic textiles. The exodus of migrant workers from the state is set to reduce India’s overall textile output by 10-15 per cent this year.

Migrant labour from Gujarat are moving out to escape the violence following rape of a minor, and better opportunities back home.

The country’s textile industry is concentrated in a few pockets of Gujarat and Maharashtra in the west and Tamil Nadu and Karnataka in the south. A large proportion of workers employed by these units comes from Bihar, Uttar Pradesh, and West Bengal. Unlike in the developed countries, textile factories in India are not fully automated and remain labour-intensive.

Small- and medium-sized units are facing huge problems in terms of labour availability. Most such units have, therefore, reduced their production target by 20-25 per cent or higher.

Data compiled by the Confederation of Indian Textile Industry shows around 100 million people are employed in the Indian textile industry, directly or indirectly, across the country.

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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