India to Levy Export Tariff on Cotton

An Indian industry executive and a government official indicated on April 9, 2010 that Indian Government would levy an export tariff on cotton to curb cotton price in India's domestic market, as India's cotton price has soared by 35 percent since the current marketing year.

This unnamed industry executive indicated that levying export tariff on cotton would be a challenge for Chinese manufacturers who import large quantities of raw materials at a relatively cheaper price from India and contend with Indian enterprises for textile export market.

As the largest textile exporter in the world, China is also the largest cotton importer from India, importing 70 percent of cotton exported from India by September 30 of the marketing year from 2008 to 2009.

It was also estimated that Indian Government would determine the export tariff rate on cotton in the week with April 12 included at the earliest.

The aforementioned government official had proved the plan by Indian Government. He also indicated that an expert team from governmental authorities had made a decision in early time this week to take measures to protect the benefits of local textile industries, with relevant measures including repealing tariff relief policy of exempting 7.5 percent export tariff on cotton yarn.