Maharashtra government has received applications of over five lakh farmers claiming damage to crops due to pink bollworm infestation and they will be compensated through seed firms and disaster relief fund, Agriculture Minister Pandurang Fundkar said in Assembly today. “We have reports from over 20 districts of Maharashtra claiming that the cotton crop is damaged due to pink bollworm. We are in the process of panchnamas and the damage caused to the crop spread over 4.90 lakh hectares in the state,” Fundkar said while replying to a discussion on problems being faced by farmers.
The ruling BJP yesterday found itself cornered in the Lower House after it came to fore that officials have failed to brief Fundkar on the issue of pink bollworm infestation. Fundkar today denied the oppositions charge that the state government was shielding seed companies from any possible action against them over the pest attack.
“Over five lakh farmers have given application claiming damage to the crop. All these farmers will be given compensation through seed companies, insurance claims and disaster relief fund,” he said. However, the opposition remained unconvinced as the minister did not announce the quantum of compensation to be paid to cotton farmers. Prior to the winter session, Opposition leaders had demanded compensation worth Rs 25,000 per acre for affected farmers. “The government is making claims that the farmers will get compensation, but is not ready to contribute on its own. The minister must announce the amount today to extend relief to farmers,” NCP MLA Ajit Pawar said.
Chief Minister Devendra Fadnavis intervened saying the government would analyse the losses and ensure that every cotton producer is given the benefit. Opposition has been demanding immediate relief to farmers saying that Bt cotton seed “BG II” has failed to protect cotton from the pink bollworm attack in Vidarbha and Marathwada regions. Opposition members yesterday alleged that though the government was aware that BG II seed lacked potential to prevent pink bollworm infestation it purposefully didnt act as it “wanted private seed-producing companies to be benefitted”. Leader of Opposition Radhakrishna Vikhe Patil (Congress) also slammed the government for failing to make any “concrete” announcement to benefit affected farmers.
Former chief minister Prithviraj Chavan said, “I doubt how much financial assistance could be given to seed companies, as the seed law is weak. It is not sufficient to prosecute the companies and get enough compensation for farmers”. The opposition members then boycotted the proceedings over the governments inability to announce the compensation amount.

Ginners across the country have decided to observe a day’s strike on Friday, with the threat of more action later, in protest at the five per cent goods and services tax (GST) on cotton.
While implementing the new tax since July 1, the GST Council had levied a five per cent rate through the Reverse Charge Mechanism (RCM) on all agricultural commodities, later deferred till March 31, 2018. However, three weeks earlier, a five per cent GST was imposed on cotton, the only agri commodity to attract this.
“Several representations were made to the ministry of textiles for withdrawal of the RCM imposed on cotton. There has been no communication from the government. Hence, the one-day strike. If the GST Council does not withdraw RCM in the next meeting scheduled on December 21, we would go on indefinite strike later,” said Upendra Singh Rajpal, president, Maharashtra Cotton Ginners Association and vice-president of the Cotton Association of India. In the RCM, a recipient of goods and/or services is liable to pay GST, instead of the supplier. In this case, ginners instead of the cotton farmers. A senior official of the Saurashtra Ginners Association said the new levy would have a big impact on ginners’ operating margins.

Cotton farmers in Maharashtra are set to lose nearly 13 per cent of their output this year due to pink bollworm attacks on the standing crop in major production regions of the state.
The textiles ministry estimates a 13 per cent decline in the average cotton yield in Maharashtra with major crop losses in Yavatmal and Jalgaon districts. Sources said around a third of Maharashtra’s cotton area were under attack by pink bollworm. Cotton farmers have voiced their concern over crop losses and have dragged seed companies to court seeking damages. According to the Cotton Advisory Board, the cotton yield in Maharashtra for the 2017-18 season will be 344.21 kg per hectare, lower than the previous year’s 395.92 kg. The board estimates cotton acreage in Maharashtra at 4.2 million hectares, a 10.5 per cent rise from 3.8 million hectares in the previous season.
Encouraged by a sharp rise in cotton prices last year, farmers in Maharashtra as elsewhere shifted from soybean to cotton this season. This resulted in a 19 per cent increase in the cotton acreage this season. With an average countrywide yield of 523.83 kg per hectare, the Cotton Advisory Board estimates the season’s total cotton output at 37.70 million bales (170 kg each), up from 34.50 million bales a year ago.
Apart from Maharashtra, pink bollworm has infested cotton fields in Madhya Pradesh, Gujarat, Telangana and Karnataka. Despite lower yields in major producing states, the supply situation is comfortable with over 4.78 million bales of closing stocks from 2016-17. “Since Pakistan has allowed market access to Indian cotton, we expect exports of 6.7 million bales in 2017-18. China, another large buyer of Indian cotton, has also reported a reduction in its cotton storage,” Textiles Commissioner Kavita Gupta said.

Opposition boycotts Assembly proceedings
Nagpur: A day after facing embarrassment over could not being able to produce information on the damage to cotton crop due to the pink bollworm pest infestation, Agriculture Minister Pandurang Fundkar on Thursday said that the government has received applications from over five lakh farmers claiming damages.
“We have the reports from over 20 districts claiming that the cotton crop has faced disease because of pink bollworm. We are in the process of conducting panchnamas. Crop in over 4.90 lakh hectare has faced damage,” Mr. Fundkar said, replying to a discussion on problems faced by the farming community.
Mr. Fundkar denied the opposition charge that the state government was safeguarding the seed companies from any possible action against them. “Over five lakh farmers have given application claiming damage to the crop. All these farmers will be given compensation through seed companies, insurance claims and disaster relief fund,” he said.
The Minister did not announce any compensation to cotton farmers, which irked the opposition. Prior to the winter session, opposition had demanded compensation of ?25,000 per acre to farmers.
“The government is claiming that the farmers will get compensation, but is not ready to do so. The Minister must announce the amount today to extend relief to farmers,” Nationalist Congress Party leader Ajit Pawar said. Chief Minister Devendra Fadnavis intervened saying the government would analyse the loss and ensure that every cotton producer benefits.
Leader of Opposition in the Assembly, Radhakrishna Vikhe-Patil too criticised the government for failing to make a concrete announcement to benefit the farmers.The Opposition unitedly boycotted the proceedings over the government’s inability to announce the compensation amount.
The Hindu had last month reported on how the state is staring at an unprecedented loss of cotton crop this year, as pink bollworm is estimated to have affected approximately 50% of the total crop. The Opposition has been claiming that the loss would cost the state ?30,000 crore.

With China, the largest importer of yarn, reducing its purchases, cotton yarn exports from the country fell 10.2% year-on-year (y-o-y) to 464 million kgs (mkgs) between April and September this year. Cotton yarn exports advanced by a mere 1.1% y-o-y in value terms to around $1.5 billion during the timeframe.
Exports to China saw the biggest fall in both volume and value terms. Cotton yarn shipments to China plunged 31.9% to 105.9 mkgs between April and September, data with the union commerce ministry showed. It fell 36.7% y-o-y in value terms to $285 million. Incidentally, cotton yarn exports hit a record $4.5 billion in 2013-14 as spinning mills performed well by taking advantage of various sops including the 2% incremental export incentive, 2% interest subvention and 3% focus market incentive.
However, export incentives provided to cotton yarn were withdrawn in 2014. Following this, yarn exports started declining and fell 26% to $3.3 billion in 2016-17. “This policy decision has adversely affected cotton yarn exports to China, the largest importer,” said Sanjay Kumar Jain, chairman, Confederation of Indian Textile Industry (CITI). “China has shifted from India to Vietnam/Indonesia as they have duty free access while Indian yarn carries 3.5% import duty,” he said. “From 2013-14 to 2016-17, there has been a decline in India’s cotton yarn exports to China by 42% while exports from Vietnam and Indonesia have increased 83% and nearly 14% respectively in the same period,” Jain stated.
Put anti-dumping duties on all textile imports from China..Jyoti Prakash Gupta
“Profit margin in the yarn industry are thin and profits are made with volumes. Withdrawal of the export incentives for cotton yarn has reduced our competitive edge by increasing our prices to the tune of 5%-6%,” he said. “Many old textile mills have been shut down. Over the last five years, spinning EBITDA (earnings before interest, taxes, depreciation and amortisation) margins have decreased at an alarming rate of 21% per annum,” the CITI chairman said. He said that the 3% IES (Interest Equalisation Scheme) benefit is essential to maintain 6-9 months of cotton inventory since it is a seasonal commodity available for four months and also to ensure consistency in quality of yarn supplied at a lower interest cost. “Indian interest rate ranges between 10% and 12.5% while interest rates of our competing nations ranges much lower at 4%-6%,” Jain said. “There is an urgent need to restore the MEIS (Merchandise Exports from India Scheme) and IES benefits for cotton yarn immediately,” he said. “There are no reasons why other segments in the textile value chain should get this benefit including MMF (man-made fibre) yarn while cotton yarn should not get the same,” the CITI chairman stated.

Cotton prices in the spot market have increased 2.5% in a week, a development that traders attributed in part to widespread belief that the output for 2017-18 would be less than 370 lakh bales although the Cotton Advisory Board has forecast 377 lakh bales in its first estimate. Traders said that this combined with the main trigger of Pakistan’s decision to allow import of Indian cotton resulted in price rise of Rs 1,000 per candy to Rs 39,500 per candy. Explaining the rationale for the forecast, Cotton Advisory Board chairman Kavita Gupta said, “We believe that 19% increase in area under cotton could compensate to some extent the losses that could be suffered due to pink bollworm problem, which has been mainly noticed in five states of the country.”
The area under cotton has increased to 122 lakh hectares from 108 lakh hectares in the previous year. The board has forecast 9.3% higher output than the production of 345 lakh bales in 2016-17. However, traders peg the output this year at 355-365 lakh bales.
Cotton harvest continues for several months as the crop yields multiple pickings. As per trade estimates, about 100 lakh bales of cotton have come to the market so far, indicating that a large crop remains to be harvested.
The Cotton Association of India, which mainly represents cotton traders, had earlier said that it estimated cotton production of 375 lakh bales for the 2017-18 season.

The Ethiopian Textile Industry Development Institute disclosed that the foreign currency generated from the textile sector has been steadily growing. Over the last three months Ethiopia has earned USD 31.2 million from textile and garment export.
The Ethiopian textile products have entered into Germany, Italy, China and United States through AGOA stated Institute Communication Directorate Director Bantihun Gessesse.
The burgeoning of the textile industries triggers the expansion of cotton farming by public, private sector and small scale farmers. Currently, the total cotton farm being cultivated has reached 42,000 hectares of land. The domestic cotton production could satisfy the local demand, he added.
The institute is providing training cotton growers to maintain the quality of the cotton.
Regarding foreign investors flow, Bantihun said that the prevalent of peace and stability, availability of abundant cheap labor, plenty of cheap energy from hydro power and flourishing industrial parks all over the country are the pulling factor.
He said thanks to the enabling investment environment currently foreign companies are injecting their money, technology, experience as well as skills on the sector.
In addition, the government is encouraging foreign investors through the provision of various incentives including tax holidays, tax free capital goods importation, custom services provision on the spot, and easily access to financial credit.
The director said that university-textile industry linkage is getting strengthened. Formerly, the only institution integrated with the industry was Bahir Dar University but currently more than six universities is enrolling students in textile and garment technology with first and second degrees.
The world number one US textile industry known as HDM has installed its factory in Hawassa Industrial Park creating10,000 jobs and expected to create many more jobs in the coming years. Most graduates from technical colleges would benefit from these job opportunities.

Bangladesh plans to increase its apparel export to the global market with a high ambition of reaching the USD 50-billion mark by 2021, in line with the government’s Vision 2021, which is centred around a goal for the country to attain the middle-income country status by that year when the nation celebrates the golden jubilee of its independence. But doubling the export, which currently stands at USD 28 billion, in just four years’ time is going to be a difficult task. The only way to increase the export amount is by adding value to the apparel.
The current competitive advantage of Bangladesh is already being challenged by countries that depend on low-cost production—like Ethiopia. Many European and US retailers and brands will follow these countries if better margins are offered. Moreover, if Bangladesh is to graduate into a middle-income country, then the wages for its four million workers involved with the garment industry will have to rise at the expense of the margins of the apparel producers, resulting in lower profitability and losing that competitive edge. It is a catch-22 situation given our current low-cost production strategy. And it’s doom to failure because of the law of nature about a developing country that must offer the benefits of a higher living standard in its journey to becoming a nearly industrialised one.
Therefore, for the growth vision for 2021 to deliver, it is high time the apparel industry leadership fostered change as regards its customer base. The first option is to keep the customers in the apparel sector, not with low cost, but with innovation, collaboration and proliferation, thereby increasing the production volume and margin. Simultaneously, growing the number of customers in the value creation process will be an added bonus.
For decades, international buyers for large international apparel chains and brands have worked under the assumption that labour cost must be kept as low as possible in order for garments to be produced at competitive prices. This widely-held belief has made the industry move from country to country, as the increase in labour cost erode each local market’s temporary advantage. One day, possibly soon, this journey will come to an end.
Cheap labour is becoming a rare commodity while the number of low-cost countries is also dwindling. Demonstrated thought leadership by the international retailers and brands need to get ahead of this trend by assessing what they can influence with their existing production partners to generate sustainable efficiency gains, improve their production speed, and ultimately take pressure off labour cost management, thus ensuring that margins are offered as a part of efficiency—not through cheaper labour. Consequently, the challenge for the apparel buyers is to collaborate with their production partners to advance the ideas of innovation, collaboration and proliferation. By inspiring, generating and adopting production innovations that improve speed and efficiency, they can increase their responsiveness to fashion cycles. By collaborating on adopting a standard unit of measure, both parties can, through this act of co-creation, help bring cost transparency to the supply chain and boost productivity. And by managing sub-suppliers and improving coordination with tier one, two and three for fabric, trim and sundries, they can proactively manage the raw material suppliers, consequently delivering positive proliferation.
Next to streamlining the internal processes to gain value growth, the other obvious concept to support the growth of Bangladesh apparel export is the external shift from volume to value customers. According to the Boston Consulting Group, there has been a rebound in consumer confidence since the last financial crisis. As confidence rises, consumers become more willing to splurge on expensive products. Therefore, there are many opportunities for the Bangladesh apparel industry to grow margins by adding value and attracting premium brands and retailers. A blouse or pair of jeans cost more or less the same to produce, and it is mainly the raw materials that are adding cost to production. Managing the raw materials will be crucial but the margin gains will be many times more as the medium to premium brands and retailers sell at a much higher retail price and can buy the product in Bangladesh at a higher price.
The biggest trend in EU and the US for capturing margin building and value adding growth is Experience Economy, which is estimated at USD 1.3 trillion in annual consumer spending in the US alone. The shift from personal goods to experiences will benefit some fashion companies, provided they are positioned correctly. For example, the rise of health and wellness experiences benefits companies that make activewear, athletic footwear, and other apparel for exercising, hiking, and spending time outdoors. The rise in leisure travel will mean higher sales of layering clothes, luggage, and travel accessories.
To respond to this, companies will need to reposition themselves—at the levels of the portfolio and individual brands—by orienting products around specific experiences.
This is where the other opportunity lies for supporting the growth vision for Bangladesh by 2021: shortcutting the traditional entry price brands by adding new medium to premium brands and retailers that are targeting the experience economy. Quick gains could come by addressing these brands in the medium to premium segment with the already established production and supply chains in Bangladesh and harvesting the margins as the retail prices are higher than the entry price brands. In this, Bangladesh faces a few challenges. Medium to premium brands and retailers are looking for value adding design perspectives that will enhance the consumer experience and set the products apart from competition. Does Bangladesh have the ability to add value to design? The second challenge is the perception of Bangladesh as a production hub that ignores social and ethical issues leading up to the collapse of factory buildings due to lack of health and safety. Many US and EU boards of directors see Bangladesh as a liability that can get a bad press and damage their image.
The value creation performance of the Bangladesh apparel industry has, for over 40 years, delivered continued growth but if the apparel industry is to continue to support the growth, change management and repositioning from volume to value are the key. There is no silver bullet to changing the industry’s future. What’s most important is that Bangladesh and its apparel industry leadership understand the factors that are most relevant to the growth vision that will allow Bangladesh to capitalise on a recovering global economy and return greater value to the future of the country.

Seeing red in the ‘pink ballworm’ menace affecting the cotton crop in Maharashtra and Telangna, the Punjab Agriculture University (PAU) has issued an advisory to Punjab’s cotton growers. Notably, the pink bollworm has damaged Bt cotton crop this year in some south and central Indian cotton-growing states like Maharashtra, Telangana etc. Alarmed, the PAU has warned the state farmers against the harmful pest.
The development assumes significance as the state’s cotton growers have suffered massive loss due to attack by the whitefly pest in 2015 — resulting in mounting numbers of farnmers’ suicides. The advisory, issued by Regional Research Station at Bathinda, has asked the farmers to follow PAU recommendations to avoid the possibility of attack by pink bollworm that eat away the cotton fibre and the bolls.
It advised the farnmers that picking should be completed as early as possible and cotton sticks should be removed from the fields. Farmers should remove the cotton sticks immediately from the fields, if they have not done this so far. Trashes of cotton and unopened bolls should also be removed from the field, it added. The advisory has also asked the farmers that animals like goats, sheep among others, should be allowed to graze on unopened bolls and plant debris in the cotton fields after the previous picking.
PAU pointed that pink bollworm can also survive on leftover cotton sticks in the field, and thus sowing of wheat in standing cotton crop should be avoided. Where it has been done, the cotton sticks shpoild be removed immediately. It has advised against stacking of cotton sticks in the fields. “Stacking should be done away from fields, preferably in village area in vertical form, away from shade after removing all the unopened bolls,” it read.
The farmers ahve also been asked to complete the ginning process latest by the end of March and leftover cotton seeds must be fed to the cattle. Acid de-linting of cottonseed kills the hidden larvae, so use the only de-linted seed for sowing, it has been advised. About 1.3 million hecatres of the 4.2 million hectare under the crop is suspected to be infected by the pink bollworm pest in Maharashtra,especially in Yavatmal district where the farmer suicide has been rampant.
In the wake of the disaster caused by the pest in Maharashtra, some of the farmers in Punjab has started storing the raw cotton hoping for higher prices in future even as the pink ballworm attack on cotton in Maharashtra is yet to affect prices. Congress-led Punjab Govrnment, already learning lessosn from the past, has asked the PAU to launch a joint awareness campaign to educate the farmers about recommended varieties of hybrids to be sown and use of quality pesticides. Notably, the state government had to cough up more than whopping Rs 640 crore as compensation to the cotton cultivators suffering loss due to whitefly attack in 2015.
Punjab Chief Minister Capt Amarinder Singh has issued strict directions to the PAU and the state Agriculture Department to intensify round-the-clock surveillance and regular monitoring on the ground to check any pest attack. He had also stressed on the need for scouting at village level, with the scouts and supervisors to be made accountable for any lapses in educating the farmers on crop protection and weed eradication. Cotton is the second major kharif crop of the state after paddy. For kharif 2017, an action plan for cotton production was prepared under which four lakh hectares were targeted. The estimated area under cotton during this season is about 3.82 lakh hectares compared to 2.57 lakh hectares in 2016. In 2016, 8.90 lakh bales of cotton had arrived in the mandis of Punjab while the cotton yield was recorded at 22 quintals per hectare (756 kg of lint per hectare).

Major farm unions in Andhra Pradesh demanded stern action against the companies involved in spread of illegal Herbicide-Tolerant Genetically Modified cotton seeds. “Tolerant cotton has not received any regulatory clearance in India, and there is much evidence about the potential adverse health and environmental impacts from such HT crops. In October 2017, the AP government constituted a committee to inquire into illegalities and risks of clandestine GM seed sales and cultivation and to make contravenors of EPA 1986 liable under the Act,” said A.P. Rythu Sangham leader Peddi Reddy. News reports indicated that many seed production plots have been found to be growing illegal HT cotton, based on the quick testing that the AP government officials did for initial confirmation. It is clear that the illegal seed supply network was at work, to prepare seed for the next season sales (kharif 2018).
It is also reported now that there have been raids on some seed processing units in Kurnool from where hundreds of tonnes of illegal HT seed has been seized. We demand that prosecution has to be initiated immediately against all the ginning factories, seed processing units and seed companies involved in this racket,” he said in a statement on Wednesday. The statement was jointly issued by AP Rythu Sangham leader Peddi Reddy, former agriculture minister and leader of Rythanga Rakshana Vedika Vadde Sobhanadreeswara Rao, Rythu Swarajya Vedika representative Vissa Kirankumar and AP Rythu Sangham secretary Prasad. “What is apparent is that organised seed industry, especially the big companies, are definitely involved in such spread of illegal, hazardous seed for it to have expanded to such vast areas, and this is ultimately going to lead farmers into a debt-suicide trap. Since the seed supply to many states is going from AP, strict action should be taken immediately,” said Peddi Reddy.
“It is estimated that the illegal HT cotton market last year was worth Rs 472 crores, with a whopping 35 lakh seed packets sold in south and central India mainly. It is a mystery as to why the AP government is not taking deterrent action against people responsible for the spread of illegal Herbicide Tolerant cotton in the state.
These HT crops lead to widespread use of cancer-causing herbicides such as Glyphosate, and development of resistant weeds in a few years. This illegal GM cotton is clearly anti-thetical to the state government’s avowed policy of promoting natural farming, so the GM seeds should be fully weeded out,” said Vissa Kirankumar of Rythu Swarajya Vedika. Former agriculture minister Vadde Sobhanadreeswara Rao said the Supreme Court appointed Technical Expert Committee had also recommended that HT crops should not be allowed in India. The Central government, under EPA 1986, has notifications issued in 2006 that empower state level seed inspectors to enter any place to determine whether the law is being complied with, and to seize materials if necessary to prevent or mitigate environmental pollution. Action can also be taken under the Seed Control Order (1983) and Seed Act (1966). In addition, the state government should also bring in a new Seed Act to protect the interests of the farmers in the future.” “Cotton farmers suffered big losses due to the pink bollworm this year, and the spread of illegal seed without permission also contributed towards this. When farmers face problems, who can they or the governments hold liable in these illegal seed supply chains?” said Prasad of AP Rythu Sangham.