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Government of India announced Minimum Support Price for Cotton

Nov 3, 2012 17:25 IST

Top Picks :  2012 Current Affairs , Economy Current Affairs , Current Affairs for MBA , November 2012 Current Affairs

The Union Government on 2 October 2012 announced a revised Minimum Support Price (MSP) for cotton and this would help in inducing stabilisation in cotton price. Cotton has witnessed a sharp decline in the past and remained operational round about its minimum support price.

After the review meet conducted on 2 October 2012, by the Union Textiles Minister, Anand Sharma the revisions were done. The decided minimum support price of medium staple cotton has gone up to 3600 rupees per quintal from initial rate of 2800 rupees. Similarly, the MSP for long staple cotton has gone up to 3900 per quintal from 3300 rupees. This rate is fixed for the fiscal year 2012-13.  

The Cotton Advisory Board has declared that the estimated production of cotton in the country for this year would be about 334 lakh bales, out of which the national consumption would record to 260 lakh bales. The surplous 70 lakh bales would be available for exports purposes.

The government has formulated a contingency plan to procure 90 lakh bales of cotton under MSP operations in the season of cotton production in the year 2012-13. To carry on with this procurement process, it has also operationlised 288 procurement centers across all the nine cotton growing states of the nation. The working capital requirement was raised to 15000 crore rupees by the Cotton Corporation of India (CCI) for operationlisation of the MSP fixed.

To control the MSP plan a special MSP cell has also been created at the CCI’s corporate office and it is headed by the A. Chokalingam, Director Marketing. To alleviate the distress of farmers from NAFED and CCI, the government would be taking serious steps for price stabilization and operationlisation of the MSP decided.

Criteria of Selection of Procurement Centers
•    Centers that would cross the expected arrivals of 50000 quintals of cotton
•    It should have an existence of market yard that is functional
•    Weighbridge should be available in the market
•    Ginning and pressing factories must be available in proximity to the center, with availability of facilities for fire fighting

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