Direct benefit transfer scheme to be extended to cotton farmers soon

The centre is planning to introduce direct benefit transfer scheme for the cotton farmers as well in the backdrop of a slowing of world cotton consumption and the states demanding higher minimum support price for the commodity.

Speaking at the inauguration of the 74th plenary of the International Cotton Advisory Committee in Mumbai today, union minister of state for textiles Santosh Kumar Gangwar said the centre has kept the interest of cotton growers in mind and increased the minimum support price (MSP) for long staple cotton to Rs4,100 for the 2015-16 marketing season.

He said the government has started a pilot project under the Direct Payment Deficiency System (DPDS) for paying MSP guarantee for the cotton farmers at Hinganghat taluka of Maharashtra. Under this system, the farmers will directly get the amount which is the difference between the MSP and the market price, should the market price fall below the MSP. For availing of the benefit, farmers would have to present proof of cotton sold at Agriculture Produce Market Committee yards, plus other papers such as ownership document, yield estimation and other details. If the pilot is successful, the DPDS would be rolled out in all cotton growing regions.

Textiles secretary S K Panda said the new move would benefit the farmers substantially.

Cotton procurement through the traditional route of Cotton Corporation of India (CCI) or state federations has been subdued this season and is expected to be lower than last year due to firm prices, which are ruling above MSP. In the 2014-15 marketing season that ended in October 2015, CCI had procured a record 8.6 million bales of cotton across the country, he said.

Meanwhile, the International Cotton Advisory Committee has revised downward world cotton consumption, following a steep slow down in China, which is the largest consumer of cotton. Cotton consumption in China is expected to be 7.33 million tonnes against 7.52 million tonnes last year. Cotton consumption in India is expected to go up by a modest three per cent from 5.4 million tonnes last year to 5.49 million tonnes this year.

The ministry of textiles has estimated cotton output in India to decline this year to 36.5 million bales, compared to 38 million bales last year. This is due to a fall in sowing area to 11.76 million hectares, from 13.08 million hectares last year, the official said. The yield, however is actually estimated to rise significantly this year, to 527.49 kg a ha from 493.77 kg last year, on sowing of higher yielding seed, he added.

The plenary meeting of ICAC, being held in India after a gap of 11 years, provides a forum for discussion of international issues of importance to the world cotton industry, and provides opportunities for industry and government leaders to consult on matters of mutual concern. Around 500 delegates from 36 countries are participating in the Mumbai plenary which will conclude on 11 December 2015.