Swarajya Logo
Swarajya Logo
Politics States Economy Society Business Culture Infra Defence World Books Ideas Science Technology Heritage Archives Legal Movies Sports
  • Our Views
    Politics States Economy Society Business Culture Infra Defence World Books Ideas Science Technology Heritage Archives Legal Movies Sports
  • Magazine
  • Store

About Swarajya

Swarajya is a publication by Kovai Media Private Limited.

Swarajya - a big tent for liberal right of centre discourse that reaches out, engages and caters to the new India.

editor@swarajyamag.com

Useful Links

  • About Us
  • Subscriptions Support
  • Editorial Philosophy
  • Press Kit
  • Privacy Policy
  • Terms of Use
  • Code of Conduct
  • Plagiarism Policy
  • Refund & Cancellation Policy

Useful Links

  • About Us
  • Subscriptions Support
  • Editorial Philosophy
  • Press Kit
  • Privacy Policy
  • Terms of Use
  • Code of Conduct
  • Plagiarism Policy
  • Refund & Cancellation Policy

Participate

  • Contact Us
  • Write for us
  • Style Guide
  • Jobs

Stay Connected

  • Artboard 2 Copy 6Created with Sketch.
    Artboard 2 Copy 10Created with Sketch.
    Artboard 2 Copy 7Created with Sketch.
    Artboard 2 Copy 9Created with Sketch.
  • Andriod Logo
  • IOS Logo

Business

Punjab Cotton-User Industry Comes Out In Support Of Agri Reforms; Says Growers Would Run Losses In Selling To APMCs

M R SubramaniTuesday, September 15, 2020 2:56 pm IST
Cotton stock.
Cotton stock.
Cotton stock.
  • The farmers could lose out on getting the MSP for cotton and probably lower than last year’s support price if they sell their produce in APMC mandis.
  • Ginners and spilling mill owners in Punjab favour the Narendra Modi government’s three ordinances promulgated on 5 June this year, ushering in huge reforms in the agricultural sector.

    The user industry’s views come ahead of the arrival of the new crop. Some of the users such as Oswal Spinning and Weaving Mills and Nahar Spinning Mills are listed on stock exchanges.

    The spinners and ginners have said that if the state government does not allow the cotton growers to sell as per the ordinance allowing them to sell to buyers of their choice or anywhere across the country, they could stand to lose Rs 300-400 per quintal (100 kg) of cotton.

    Some officials in the user industry say the loss for the farmer on his/her return could be up to nearly 10 per cent, particularly if the sale is routed through the Agricultural Produce Marketing Committee (APMC) mandis and commission agents (arhatiyas).

    This means they could lose out on getting the minimum support price (MSP) for cotton and probably lower than last year’s support price.

    For this crop year (July 2020-June 2021), the Centre has raised the MSP for medium staple cotton by Rs 260 a quintal to Rs 5,515 per quintal. The MSP for long-staple cotton has been fixed at Rs 5,825 per quintal, up by Rs 275.

    The stand of the cotton user industry comes on the heels of the Capt Amarinder Singh government passing a resolution in Punjab Assembly against the ordinances.

    In the resolution, the Congress-ruled government said it would hit the farmers hard, especially those growing crops for which the Centre has fixed MSPs.

    Capt Singh government's stance is in line with the Congress stand opposing the ordinances. The party's fear is that these agricultural reforms will loosen its hold in the rural areas, where its leaders call the shots in APMC mandis.

    Union Agriculture Minister Narendra Singh Tomar told Parliament yesterday (14 September) that MSP procurement will not be affected by the promulgation of these three ordinances.

    As part of the Atmanirbar Bharat Abhiyan (self-sufficient India programme) to help spur the economy hit by the novel coronavirus pandemic, the Centre promulgated The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020, The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020 and The Essential Commodities (Amendment) Ordinance, 2020.

    These ordinances allow farmers to sell to buyers of their choice and enter into contract farming if they need an assured price even before they begin cultivation.

    The amendment to the Essential Commodities Act will help growers sell their produce to buyers even during peak harvest season. Some vested interests point to the Essential Commodities Act to stop purchases and force them to resort to panic sales.

    According to the Cotton Corporation of India, Punjab is projected to have produced 13 lakh bales (of 170 kg each) cotton during the current cotton year ending this month. This is 3 lakh bales more than last year.

    Haryana and the Ganganagar tracts of Rajasthan together with Punjab form north India’s cotton-growing areas. Together, this year the region is projected to have produced 60 lakh bales of the 360 lakh bales in the country. Rajasthan has topped the production in the region with 25 lakh bales.

    The ginners are the main buyers of cotton as they process raw cotton to separate the seeds and gin the cotton into bales of 170 kg. The spinning mills buy the ginner cotton and convert them into yarn.

    One of the reasons that Punjab is opposed to direct sales of farm produce to buyers is that it stands to lose some 4.5 per cent it receives as tax for sales of agricultural products. The 4.5 per cent is comprised of mandi fee and rural development cess (total 2 per cent) and a 2.5 per cent commission that growers pay to commission agents.

    The user industry has questioned the need to pay the mandi fee, cess and commission when the Centre has allowed growers to sell their produce to anyone.

    Indian Express quoted a spinning mill official as saying that the 4.5 per cent tax would be deducted from the payment due to farmers, who would then have to settle for a lower payment.

    The Cotton Corporation of India (CCI) purchases a huge amount of cotton but its procurement in the northern region is minimal. Thus, farmers in Punjab, Haryana and Rajasthan have to depend on ginners and spinners to sell their produce.

    This will likely result in farmers near the borders of Haryana crossing over to sell their produce there. The user industry has also decided to protest against the imposition of mandi fee and development cess.

    The Centre has made it clear that while farmers would have the freedom to choose their buyers, the APMC mandis will exist side by side.

    Tags
    Agricultural Produce Marketing Committee (APMC)
    National Agricultural Market
    Punjab Chief Minister Amarinder Singh
    India cotton sector
    Agricultural Market Reforms
    Cotton production
    Punjab Congress Government
    Punjab cotton user industry
    Punjab Spinning Mills
    Mandi fees
    Development cess
    Arhatiyas

    Comments ↓

    An Appeal...


     

    Dear Reader,

     

    As you are no doubt aware, Swarajya is a media product that is directly dependent on support from its readers in the form of subscriptions. We do not have the muscle and backing of a large media conglomerate nor are we playing for the large advertisement sweep-stake.

     

    Our business model is you and your subscription.  And in challenging times like these, we need your support now more than ever.

     

    We deliver over 10 - 15 high quality articles with expert insights and views. From 7AM in the morning to 10PM late night we operate to ensure you, the reader, get to see what is just right.

     

    Becoming a Patron or a subscriber for as little as Rs 1200/year is the best way you can support our efforts.

    Get Swarajya in your inbox.


    Magazine


    Swarajya Magazine Cover Image
    Merchandise

    Merchandise


      Politics

      How BJP Successfully Campaigned For Bengali Votes In Chhattisgarh

      How BJP Successfully Campaigned For Bengali Votes In Chhattisgarh

      Jaideep Mazumdar
      10h

      Tamil Nadu Dashboard: DMK MP Uses 'Gaumutra' Jibe In Parliament Speech; CM Stalin Requests Rs 5060 Crore Interim Relief For Cyclone Michaung Damage

      Swarajya Staff
      10h

      "CMs Should Be Informed In Advance": After Nitish Kumar, Mamata Banerjee Commits To Joining Next INDI Alliance Meet

      Nishtha Anushree
      11h

      Economy

      India Anticipated To Be Fastest Growing In Next Three Years, Set to Become Third Largest Economy By 2030: S&P

      India Anticipated To Be Fastest Growing In Next Three Years, Set to Become Third Largest Economy By 2030: S&P

      Nishtha Anushree
      2d

      Sensex Surpasses 69,000 For First Time As Investor Confidence Surges Post BJP Sweep In Three States

      Bhuvan Krishna
      2d

      Sensex, Nifty Close At All-Time High After BJP Victories In Three States, Record Surge Of Over 2 Per Cent

      Nishtha Anushree
      3d

      Defence

      On This Day, In 1971, Indian Tanks Rolled Into Pakistan's Heartland At Shakargarh Bulge, Marking The Beginning Of The Fierce Battle Of Basantar

      On This Day, In 1971, Indian Tanks Rolled Into Pakistan's Heartland At Shakargarh Bulge, Marking The Beginning Of The Fierce Battle Of Basantar

      Ujjwal Shrotryia
      13h

      Indian Army's Captain Geetika Koul Becomes First Female Medical Officer To Be Deployed At Siachen — The World's Highest Battlefield

      Swarajya Staff
      13h

      Unknown Gunmen At Work Again: Another LeT Terrorist 'Adnan Ahmed' Close To Hafeez Saeed Shot Dead In Pakistan

      Swarajya Staff
      15h

      World

      "Not Yielded Expected Outcomes": Italy Officially Withdraws From Belt And Road Initiative Giving Jolt To China

      "Not Yielded Expected Outcomes": Italy Officially Withdraws From Belt And Road Initiative Giving Jolt To China

      Nishtha Anushree
      10h

      Trading On Terror? Study Claims Hamas Made Millions By Short-Selling Ahead Of 7 October Attack

      Nayan Dwivedi
      12h

      Forbes Declares Nirmala Sitharaman Most Powerful Woman Of India, Three Other Indians In World's Top 100

      Nishtha Anushree
      13h

      Culture

      'Celebrate At Home': Champat Rai Of Ram Janambhoomi Trust Urges Hindus Not To Visit Ayodhya On 22 January

      'Celebrate At Home': Champat Rai Of Ram Janambhoomi Trust Urges Hindus Not To Visit Ayodhya On 22 January

      Bhuvan Krishna
      2d

      'Animal': Sandeep Reddy Vanga 2 – Liberals 0

      K Balakumar
      4d

      Why The Insidious Anti-Hindu Communalism Of Certain Directors Goes Scot-Free

      Anonymous Contributor
      5d
      States

      infrastructure


      Amit Mishra
      1

      BMC Issues Rs 1362 Crore Tender For Concretisation Of Mumbai Roads

      2 Mins Read
      V Bhagya Subhashini
      2

      Tamil Nadu: V O Chidambaranar Port Gets PPPAC's Approval For Rs 7,056 Crore Container Terminal Project

      2 Mins Read
      V Bhagya Subhashini
      3

      Kochi Metro Phase II: Kerala Government Allocates Rs 378.57 Crore For Pink Line

      2 Mins Read
      V Bhagya Subhashini
      4

      Uttarakhand Government To Enforce Stringent Tunnel Construction SOPs Post-Silkyara Incident

      3 Mins Read