(MENAFN- KNN India)
New Delhi, Sep 20 (KNN)
India's textile industry faces a significant challenge as reduced cotton sowing during the ongoing kharif season raises concerns about meeting the government's ambitious export targets.
With cotton sowing dropping to 11.24 million hectares as of 13 September-down
from 12.36
million hectares in the same period last year-questions loom over the ability of the readymade garment (RMG) sector to seize additional export orders amid Bangladesh's ongoing crisis, according to two sources familiar with the situation.
Cotton production, already under pressure in recent years, is expected to take another hit. "Certainly, there has been a contraction in production, and this year, low sowing levels will further reduce cotton bales output," a source explained.
The hope is for some improvement, with cotton sowing potentially reaching 11.6 million hectares by the addition of 300,000 hectares from Tamil Nadu, Telangana, and Karnataka. However, this is unlikely to offset the overall decline.
This reduction in cotton output could prove detrimental to India's textile export performance, which has already been volatile. Exports, which stood at $41.12 billion in FY22, dropped to $35.55 billion in FY23 and further to $34.40 billion in FY24.
The government's target of exceeding $40 billion by FY25 now seems increasingly difficult. "The low sowing and reduced production make achieving the export target very challenging," said Abhash Kumar, an economics expert.
India's cotton production peaked in FY20 at 36 million bales but has since been in decline. Despite a brief recovery in FY23, production fell again to 32 million bales in FY24.
Farmers, constrained by outdated seed technology and labor shortages, have shifted to alternative crops like soybean and paddy. "Cotton requires more resources and labor compared to soybean, making it less attractive for farmers," said Ganesh Nanote, a cotton farmer from Maharashtra.
Given that 55-60% of India's textile exports rely on natural fibres like cotton, low sowing levels pose a significant risk to India's global competitiveness, according to Mihir Parekh of the Foundation for Economic Development. Further complicating matters, cotton imports attract a 10% duty, increasing costs across the value chain.
Despite these hurdles, India's textile sector is projected to grow to $350 billion by 2030, aiming to capture a larger share of the global market. However, experts agree that to meet these lofty goals, addressing the current challenges in cotton production is crucial.
(KNN Bureau)
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