TEXPROCIL: India’s Falling Cotton Yarn Exports Could Lead To Mill Closures


Dr. K.V.Srinivasan, Chairman, Texprocil, stated that India’s exports of cotton yarn in the first quarter of April-June 2019 have fallen by a steep 33%, from 338 million kgs for the period April-June 2018 to 226 million kgs in April–June 2019.

“Month on month decline from 90 million kgs in April 2019 to 77 million kgs in May to 59 million kgs in June, is a matter of deep concern.  In fact, the level of 59 million kgs is the lowest monthly export in the last five years,”  he said.

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The steep fall has been caused by a variety of reasons including decline in exports to leading markets like China, Bangladesh, South Korea and the duty-free access given for import of cotton yarn by China to countries like Pakistan and Vietnam from 1st April 2019.

Considering the large scale investment in the spinning sector and sluggish demand in the domestic markets, exports are the only avenue to ensure uninterrupted production and capacity utilisation.

Dr. Srinivasan pointed out that even though cotton yarn is a value added product, it has been excluded from the export benefits like interest subvention, MEIS and the ROSCTL schemes.

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In view of the above the Chairman, Texprocil appealed to the government to include cotton yarn in the interest subvention scheme and also rebate the embedded taxes like Agricultural Cess, Mandi Tax, Power and Fuel Surcharge, incurred during the production process.  The ROSCTL Scheme which rebates these levies should be extended to cotton yarn sector at the earliest.

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He said that if the current trends of declining exports continue in the next quarter, it will lead to closure of several spinning units in the near future, resulting in layoffs.


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