(a) whether there is a huge gap between the input cost incurred on cotton
production in the country and the Minimum Support Price (MSP) of cotton;
(b) if so, whether the Government is contemplating to increase its MSP and
impose duty on import of cotton;
(c) whether the Government has formulated any scheme to ensure remunerative
prices of cotton to the farmers; and
(d) if so, the details thereof?
MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE, FOOD
PROCESSING INDUSTRIES AND PARLIAMENTARY AFFAIRS (SHRI HARISH RAWAT)
(a) & (b): Government of India while announcing Minimum Support Price (MSP)
for cotton, interalia, considers cost of production of cotton including all the input
costs. The all- India weighted average cost of production (C2) for cotton projected
by the Commission for Agricultural Costs and Prices (CACP) for 2010-11 is Rs.
2128.59 per quintal. Accordingly, the MSP for 2010-11 season has been fixed at Rs.
2500 per quintal for cotton of staple length 24.5 mm - 25.5 mm and Micronaire value
4.3-5.1 and Rs. 3000 per quintal for cotton of staple length 29.5 mm-30.5 mm and
Micronaire value 3.5-4.3. The all India cost of production for cotton for 2011-12 has
been projected by CACP at Rs. 2528.37 per quintal. Hence, the MSP for cotton for
2011-12 season has been raised by Rs. 300 over previous season and fixed at Rs.
2800 per quintal for cotton of medium staple length of 24.5 mm - 25.5 mm and
Micronaire value of 4.3-5.1 and Rs. 3300 per quintal for cotton of long staple length
of 29.5 mm-30.5 mm and Micronaire value of 3.5-4.3.
Department of Agriculture & Cooperation has not proposed for imposing duty
on cotton. Further, domestic cotton mills are meeting their cotton requirements from
domestic markets, rather than resorting to imports. As a result, the cotton imports
into the country are about 5 to 10 lakh bales mainly of Extra Long Staple (ELS) varieties,
which are in short supply.
(c) & (d): The Government of India announces Minimum Support Prices (MSP)
for cotton to ensure remunerative prices to the farmers on the recommendations of
CACP. The CACP, while formulating its recommendations on price policy considers,
inter-alia, cost of production, changes in input prices, input/output price parity,
trends in market prices, demand and supply situation, inter-crop price parity, effect
on industrial cost structure, effect on general price level, effect on cost of living,
suggestions received from farmers/others, international market price situation and
parity between prices paid and prices received by the farmers