Modi government urged to regulate exports of cotton yarn
What's the story
The Apparel Export Promotion Council (AEPC) has urged Commerce Minister Piyush Goyal to regulate cotton yarn exports. AEPC Chairman A Sakthivel said the rising prices of raw cotton and yarn are due to supply-side constraints. He noted that limited stock with ginners and reduced arrivals have forced mills to rely more on Cotton Corporation of India (CCI) auctions.
Market concerns
AEPC urges minister to take measures for regulating exports
Sakthivel also highlighted that a huge quantity of cotton has been transferred from farmers to traders, leading to hoarding and speculative practices in the market.
He said, "AEPC has urged the minister to consider suitable measures to regulate the export of cotton yarn, particularly 20s count and above."
This is in light of skyrocketing yarn prices and their impact on India's apparel export industry competitiveness.
Price surge
Rising prices putting pressure on apparel manufacturing value chain
Cotton yarn prices have skyrocketed some 60%, from ₹250 per kg in early 2026 to nearly ₹400 per kg now.
The AEPC chairman said this is putting pressure on the apparel manufacturing value chain.
He also noted that rising costs of other raw materials and fuel are making matters worse for the industry.
Global impact
Letter highlights rising exports of Indian cotton and cotton yarn
Sakthivel's letter also points to rising exports of Indian cotton and cotton yarn to apparel-producing nations like Bangladesh and Vietnam.
This comes after the US imposed restrictions on the use of Chinese cotton under the Uyghur Forced Labor Prevention Act (UFLPA).
He said these developments have further fueled raw material prices across the garment value chain, making it harder for Indian exporters at a time when global opportunities are expanding.
Economic comparison
Economic benefits of finished garment exports
Sakthivel stressed the much higher value realization and employment potential of finished garment exports over raw cotton and yarn.
He said while raw cotton fetches around ₹275 per kg and its conversion into yarn fetches some ₹325 per kg, a kilogram of value-added garments can earn between ₹800-1,200.
This stark difference highlights the economic benefits of focusing on finished garment exports rather than just raw material exports.