India reverses cotton export ban in face of protests

GlobalPost

India has reversed a brief ban on cotton exports after China, the biggest consumer of cotton, lodged a formal protest and Indian farmers voiced their concerns.

The government only announced the policy last Monday, according to the BBC, saying that India needed to protect supplies for its own cotton mills.

India's agriculture minister, meantime, complained that he was not consulted about the new policy.

And Nayan Mirani, vice-president of the Cotton Association of India, which represents exporters and traders, was quoted by the BBC sa saying: "We must realise that we are a cotton surplus country and our surplus needs to be exported. These are short-sighted views that [the textile] industry sometimes takes by asking to ban cotton exports."

India is the world's second biggest producer of cotton, and according to the BBC, Indian exporters had outstanding orders for 2.5 million bales of cotton when the ban was imposed.

In light of the reactions to the ban, Indian prime minister Manmohan Singh on Sunday requested an urgent review of the ban, the Financial Times reported.

Announcing the rollback of the ban Sunday, Commerce Minister Anand Sharma said, according to Agence France-Presse: "Keeping in view the facts, the interests of the farmers, interest of the industry, trade, a balanced view has been considered by the Group of Ministers to roll back the ban."

The formal order to lift the ban would be issued Monday, Sharma said.

According to AFP, the export ban sent cotton prices soaring on New York's commodity markets. The US was also expecting an influx of Chinese buyers as a result.

Sign up for our daily newsletter

Sign up for The Top of the World, delivered to your inbox every weekday morning.